EXHIBIT 4.1
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MAAX CORPORATION,
as Issuer,
the GUARANTORS party hereto,
as Guarantors,
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
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INDENTURE
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Dated as of June 4, 2004
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9.75% Senior Subordinated Notes due 2012
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CROSS-REFERENCE TABLE
Trust Indenture Act Indenture
Section Section
------------------- -----------------
310 (a)(1)................................ 7.10
(a)(2)................................ 7.10
(a)(3)................................ N.A.
(a)(4)................................ N.A.
(a)(5)................................ 7.08; 7.10
(b)................................... 7.08; 7.10; 12.02
(c)................................... N.A.
311 (a)................................... 7.11
(b)................................... 7.11
(c)................................... N.A.
312 (a)................................... 2.05
(b)................................... 12.03
(c)................................... 12.03
313 (a)................................... 7.06
(b)(1)................................ 7.06
(b)(2)................................ 7.06
(c)................................... 7.06; 12.02
(d)................................... 7.06
314 (a)................................... 4.06; 4.18; 12.02
(b)................................... N.A.
(c)(1)................................ 7.02; 12.04; 12.05
(c)(2)................................ 7.02; 12.04; 12.05
(c)(3)................................ N.A.
(d)................................... N.A.
(e)................................... 12.05
(f)................................... N.A.
315 (a)................................... 7.01(b); 7.02(a)
(b)................................... 7.05; 12.02
(c)................................... 7.01
(d)................................... 6.05; 7.01(c)
(e)................................... 6.11
316 (a)(last sentence).................... 2.09
(a)(1)(A)............................. 6.05
(a)(1)(B)............................. 6.04
(a)(2)................................ 9.02
(b)................................... 6.07
(c)................................... 9.05
317 (a)(1)................................ 6.08
(a)(2)................................ 6.09
(b)................................... 2.04
Trust Indenture Act Trust Indenture Act
Section Section
------------------- ---------
318 (a).......................................... 12.01
(c)........................................ 12.01
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N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Indenture.
TABLE OF CONTENTS
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ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE........................................ 1
SECTION 1.01. Definitions....................................................................... 1
SECTION 1.02. Other Definitions................................................................. 26
SECTION 1.03. Incorporation by Reference of Trust Indenture Act................................. 27
SECTION 1.04. Rules of Construction............................................................. 27
ARTICLE TWO THE NOTES......................................................................... 28
SECTION 2.01. Form and Dating................................................................... 28
SECTION 2.02. Execution, Authentication and Denomination; Additional Notes; Exchange
Securities...................................................................... 29
SECTION 2.03. Registrar and Paying Agent........................................................ 30
SECTION 2.04. Paying Agent To Hold Assets in Trust.............................................. 31
SECTION 2.05. Holder Lists...................................................................... 31
SECTION 2.06. Transfer and Exchange............................................................. 31
SECTION 2.07. Replacement Notes................................................................. 32
SECTION 2.08. Outstanding Notes................................................................. 32
SECTION 2.09. Treasury Notes.................................................................... 33
SECTION 2.10. Temporary Notes................................................................... 33
SECTION 2.11. Cancellation...................................................................... 33
SECTION 2.12. Defaulted Interest................................................................ 33
SECTION 2.13. CUSIP and ISIN Numbers............................................................ 34
SECTION 2.14. Deposit of Moneys................................................................. 34
SECTION 2.15. Book-Entry Provisions for Global Notes............................................ 34
SECTION 2.16. Special Transfer and Exchange Provisions.......................................... 35
ARTICLE THREE REDEMPTION........................................................................ 39
SECTION 3.01. Notices to Trustee................................................................ 39
SECTION 3.02. Selection of Notes To Be Redeemed................................................. 39
SECTION 3.03. Notice of Redemption.............................................................. 40
SECTION 3.04. Effect of Notice of Redemption.................................................... 41
SECTION 3.05. Deposit of Redemption Price....................................................... 41
SECTION 3.06. Notes Redeemed in Part............................................................ 41
ARTICLE FOUR COVENANTS......................................................................... 41
SECTION 4.01. Payment of Notes.................................................................. 41
SECTION 4.02. Maintenance of Office or Agency................................................... 42
SECTION 4.03. Corporate Existence............................................................... 42
SECTION 4.04. Payment of Taxes.................................................................. 42
SECTION 4.05. Reserved.......................................................................... 43
SECTION 4.06. Compliance Certificate; Notice of Default......................................... 43
SECTION 4.07. Payments for Consent.............................................................. 43
SECTION 4.08. Waiver of Stay, Extension or Usury Laws........................................... 43
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SECTION 4.09. Change of Control................................................................. 44
SECTION 4.10. Incurrence of Indebtedness and Issuance of Preferred Stock........................ 45
SECTION 4.11. Limitations on Restricted Payments................................................ 49
SECTION 4.12. Limitations on Liens.............................................................. 52
SECTION 4.13. Limitations on Asset Sales........................................................ 52
SECTION 4.14. Limitations on Transactions with Affiliates....................................... 55
SECTION 4.15. Dividend and Other Payment Restrictions Affecting Subsidiaries.................... 57
SECTION 4.16. Subsidiary Guarantees............................................................. 59
SECTION 4.17. Limitations on Layering Indebtedness.............................................. 60
SECTION 4.18. Reports to Holders................................................................ 60
SECTION 4.19. Limitations on Designation of Restricted and Unrestricted Subsidiaries............ 61
SECTION 4.20. Business Activities............................................................... 61
SECTION 4.21. Additional Amounts................................................................ 62
ARTICLE FIVE SUCCESSOR CORPORATION............................................................. 64
SECTION 5.01. Mergers, Consolidations, Etc...................................................... 64
ARTICLE SIX DEFAULT AND REMEDIES.............................................................. 66
SECTION 6.01. Events of Default................................................................. 66
SECTION 6.02. Acceleration...................................................................... 68
SECTION 6.03. Other Remedies.................................................................... 69
SECTION 6.04. Waiver of Past Defaults........................................................... 69
SECTION 6.05. Control by Majority............................................................... 69
SECTION 6.06. Limitation on Suits............................................................... 69
SECTION 6.07. Rights of Holders To Receive Payment.............................................. 70
SECTION 6.08. Collection Suit by Trustee........................................................ 70
SECTION 6.09. Trustee May File Proofs of Claim.................................................. 70
SECTION 6.10. Priorities........................................................................ 71
SECTION 6.11. Undertaking for Costs............................................................. 71
ARTICLE SEVEN TRUSTEE........................................................................... 72
SECTION 7.01. Duties of Trustee................................................................. 72
SECTION 7.02. Rights of Trustee................................................................. 73
SECTION 7.03. Individual Rights of Trustee...................................................... 74
SECTION 7.04. Trustee's Disclaimer.............................................................. 74
SECTION 7.05. Notice of Default................................................................. 74
SECTION 7.06. Reports by Trustee to Holders..................................................... 75
SECTION 7.07. Compensation and Indemnity........................................................ 75
SECTION 7.08. Replacement of Trustee............................................................ 76
SECTION 7.09. Successor Trustee by Merger, Etc.................................................. 77
SECTION 7.10. Eligibility; Disqualification..................................................... 77
SECTION 7.11. Preferential Collection of Claims Against the Issuer.............................. 77
ARTICLE EIGHT DISCHARGE OF INDENTURE; DEFEASANCE................................................ 78
SECTION 8.01. Termination of the Issuer's Obligations........................................... 78
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SECTION 8.02. Option to Effect Legal Defeasance or Covenant Defeasance.......................... 79
SECTION 8.03. Legal Defeasance.................................................................. 79
SECTION 8.04. Covenant Defeasance............................................................... 80
SECTION 8.05. Conditions to Legal or Covenant Defeasance........................................ 80
SECTION 8.06. Deposited Money and Government Securities to Be Held in Trust; Other
Miscellaneous Provisions........................................................ 82
SECTION 8.07. Repayment to Issuer............................................................... 82
SECTION 8.08. Reinstatement..................................................................... 82
ARTICLE NINE AMENDMENTS, SUPPLEMENTS AND WAIVERS............................................... 83
SECTION 9.01. Without Consent of Holders........................................................ 83
SECTION 9.02. With Consent of Holders........................................................... 84
SECTION 9.03. Effect on Senior Debt............................................................. 85
SECTION 9.04. Compliance with the Trust Indenture Act........................................... 85
SECTION 9.05. Revocation and Effect of Consents................................................. 85
SECTION 9.06. Notation on or Exchange of Notes.................................................. 86
SECTION 9.07. Trustee To Sign Amendments, Etc................................................... 86
ARTICLE TEN SUBORDINATION OF NOTES............................................................ 87
SECTION 10.01. Notes Subordinated to Senior Debt................................................. 87
SECTION 10.02. Suspension of Payment When Senior Debt Is in Default.............................. 87
SECTION 10.03. Notes Subordinated to Prior Payment of All Senior Debt on Dissolution,
Liquidation or Reorganization of the Issuer..................................... 88
SECTION 10.04. Payments May Be Made on Notes..................................................... 90
SECTION 10.05. Holders To Be Subrogated to Rights of Holders of Senior Debt...................... 90
SECTION 10.06. Obligations of the Issuer Unconditional........................................... 90
SECTION 10.07. Notice to Trustee................................................................. 91
SECTION 10.08. Reliance on Judicial Order or Certificate of Liquidating Agent.................... 91
SECTION 10.09. Trustee's Relation to Senior Debt................................................. 91
SECTION 10.10. Subordination Rights Not Impaired by Acts or Omissions of the Issuer or Holders
of Senior Debt.................................................................. 92
SECTION 10.11. Holders Authorize Trustee To Effectuate Subordination of Notes.................... 92
SECTION 10.12. This Article Ten Not To Prevent Events of Default................................. 93
SECTION 10.13. Trustee's Compensation Not Prejudiced............................................. 93
ARTICLE ELEVEN NOTE GUARANTEE.................................................................... 93
SECTION 11.01. Unconditional Guarantee........................................................... 93
SECTION 11.02. Subordination of Note Guarantee................................................... 94
SECTION 11.03. Limitation on Guarantor Liability................................................. 94
SECTION 11.04. Execution and Delivery of Note Guarantee.......................................... 95
SECTION 11.05. Release of a Subsidiary Guarantor................................................. 95
SECTION 11.06. Waiver of Subrogation............................................................. 96
SECTION 11.07. Immediate Payment................................................................. 96
SECTION 11.08. No Set-Off........................................................................ 96
SECTION 11.09. Guarantee Obligations Absolute.................................................... 97
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SECTION 11.10. Note Guarantee Obligations Continuing............................................. 97
SECTION 11.11. Note Guarantee Obligations Not Reduced............................................ 97
SECTION 11.12. Note Guarantee Obligations Reinstated............................................. 97
SECTION 11.13. Note Guarantee Obligations Not Affected........................................... 97
SECTION 11.14. Waiver............................................................................ 99
SECTION 11.15. No Obligation to Take Action Against the Issuer................................... 99
SECTION 11.16. Dealing with the Issuer and Others................................................ 99
SECTION 11.17. Default and Enforcement........................................................... 99
SECTION 11.18. Acknowledgment.................................................................... 100
SECTION 11.19. Costs and Expenses................................................................ 100
SECTION 11.20. No Merger or Waiver; Cumulative Remedies.......................................... 100
SECTION 11.21. Survival of Note Guarantee Obligations............................................ 100
SECTION 11.22. Note Guarantee in Addition to Other Guarantee Obligations......................... 100
SECTION 11.23. Severability...................................................................... 100
SECTION 11.24. Successors and Assigns............................................................ 101
ARTICLE TWELVE MISCELLANEOUS..................................................................... 101
SECTION 12.01. Trust Indenture Act Controls...................................................... 101
SECTION 12.02. Notices........................................................................... 101
SECTION 12.03. Communications by Holders with Other Holders...................................... 102
SECTION 12.04. Certificate and Opinion as to Conditions Precedent................................ 102
SECTION 12.05. Statements Required in Certificate or Opinion..................................... 103
SECTION 12.06. Rules by Paying Agent or Registrar................................................ 103
SECTION 12.07. Legal Holidays.................................................................... 103
SECTION 12.08. Governing Law..................................................................... 103
SECTION 12.09. No Adverse Interpretation of Other Agreements..................................... 103
SECTION 12.10. No Recourse Against Others........................................................ 103
SECTION 12.11. Successors........................................................................ 104
SECTION 12.12. Duplicate Originals............................................................... 104
SECTION 12.13. Severability...................................................................... 104
SECTION 12.14. Agent for Service and Waiver of Immunities........................................ 104
SECTION 12.15. Judgment Currency................................................................. 105
Signatures................................................................................................... S-1
Exhibit A - Form of Note
Exhibit B - Form of Legends
Exhibit C - Form of Certificate To Be Delivered in Connection with Transfers
to Non-QIB Accredited Investors
Exhibit D - Form of Certificate To Be Delivered in Connection with Transfers
Pursuant to Regulation S
Exhibit E - Form of Certificate To Be Delivered in Connection with Transfers
of Temporary Regulation S Global Note
Exhibit F - Form of Notation of Subsidiary Guarantee
Note: This Table of Contents shall not, for any purpose, be deemed to be part of
this Indenture.
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INDENTURE dated as of June 4, 2004 among MAAX Corporation, a Nova
Scotia unlimited company (the "ISSUER"), and each of the Guarantors named
herein, as Guarantors, and U.S. Bank Trust National Association, a national
banking association, as Trustee (the "TRUSTEE").
The Issuer has duly authorized the creation of an issue of 9.75%
Senior Subordinated Notes due 2012 and, to provide therefor, the Issuer and the
Guarantors have duly authorized the execution and delivery of this Indenture.
All things necessary to make the Notes, when duly issued and executed by the
Issuer and authenticated and delivered hereunder, the valid and binding
obligations of the Issuer and to make this Indenture a valid and binding
agreement of the Issuer and the Guarantors has been done.
For and in consideration of the premises and the purchase of the
Notes by the Holders thereof, the parties hereto covenant and agree, for the
equal and proportionate benefit of all Holders, as follows:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
Set forth below are certain defined terms used in this Indenture.
"144A GLOBAL NOTE" has the meaning given to such term in Section
2.01.
"ACQUIRED DEBT" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such other
Person is merged with or into or became a Restricted Subsidiary of such
specified Person, whether or not such Indebtedness is incurred in
connection with, or in contemplation of, such other Person merging with or
into, or becoming a Restricted Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset acquired by
such specified Person.
"AFFILIATE" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise. For purposes of this definition, the terms
"controlling," "controlled by" and "under common control with" have correlative
meanings.
"AGENT" means any Registrar or Paying Agent.
"APPLICABLE PREMIUM" means, with respect to a Note at any Redemption
Date, the greater of:
(1) 1.0% of the principal amount of such Note; and
(2) the excess of:
(a) the present value at such Redemption Date of (1) the
Redemption Price of such Note on the Fourth Anniversary (such
Redemption Price being that described in Section 5(a) of the Notes)
plus (2) all required remaining scheduled interest payments due on
such Note through the Fourth Anniversary, other than accrued
interest to such Redemption Date, computed using a discount rate
equal to the Treasury Rate plus 50 basis points, discounted on a
semi-annual bond equivalent basis, over
(b) the principal amount of such Note on such Redemption Date.
Calculation of the Applicable Premium shall be made by the Issuer or on behalf
of the Issuer by such Person as the Issuer shall designate; provided, however,
that such calculation shall not be a duty or obligation of the Trustee.
"ASSET SALE" means:
(1) the sale, lease, conveyance or other disposition of any assets
other than in the ordinary course of business; provided that the sale,
conveyance or other disposition of all or substantially all of the assets
of Holdings and the Restricted Subsidiaries taken as a whole shall be
governed by the provisions of Sections 4.09 and/or 5.01 and not by the
provisions of Section 4.13; and
(2) the issuance of Equity Interests in any of the Restricted
Subsidiaries or the sale of Equity Interests in any of the Restricted
Subsidiaries.
Notwithstanding the preceding, none of the following items shall be
deemed to be an Asset Sale:
(1) any single transaction or series of related transactions that
involves assets having a Fair Market Value of less than US$2.5 million;
(2) a transfer of assets between or among Holdings and/or the
Restricted Subsidiaries;
(3) an issuance of Equity Interests by a Restricted Subsidiary to
Holdings or to another Restricted Subsidiary or the issuance of Equity
Interests by a Restricted Subsidiary in which Holdings' percentage
interest (direct and indirect) in the Equity Interests of such Restricted
Subsidiary, after giving effect to such issuance, is at least equal to its
percentage interest prior thereto;
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(4) the sale, lease, conveyance or other disposition of assets in
the ordinary course of business and any sale or other disposition of
damaged, worn-out or obsolete assets in the ordinary course of business;
(5) the sale or other disposition of cash or Cash Equivalents;
(6) a Restricted Payment that does not violate Section 4.11 or a
Permitted Investment;
(7) sales of accounts receivable pursuant to Permitted Factoring
Arrangements;
(8) the licensing or sublicensing of intellectual property or other
general intangibles and licenses, leases or subleases of other property in
the ordinary course of business which do not materially interfere with the
business of Holdings and the Restricted Subsidiaries; and
(9) the sale of Permitted Investments (other than sales of Equity
Interests of any of the Restricted Subsidiaries) made by Holdings or any
Restricted Subsidiary after the date of this Indenture, if such Permitted
Investments were (a) received in exchange for, or purchased out of the net
cash proceeds of the substantially concurrent sale (other than to a
Subsidiary of Holdings) of, Equity Interests of Holdings (other than
Disqualified Stock) or (b) received in the form of, or were purchased from
the proceeds of, a substantially concurrent contribution of common equity
capital to Holdings.
"BANKRUPTCY LAW" means Title 11 of the United States Code, as
amended, or any applicable United States federal or state law for the relief of
debtors or Canadian federal or provincial bankruptcy, insolvency, reorganization
or other similar law, including without limitation the Bankruptcy and Insolvency
Act (Canada) and the Companies' Creditors Arrangement Act (Canada).
"BENEFICIAL OWNER" has the meaning assigned to such term in Rule
13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person" (as that term is used in Section
13(d)(3) of the Exchange Act), such "person" shall be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire by
conversion or exercise of other securities, whether such right is currently
exercisable or is exercisable only after the passage of time. The terms
"Beneficially Owns" and "Beneficially Owned" have a corresponding meaning.
"BOARD OF DIRECTORS" means:
(1) with respect to a corporation, the board of directors of the
corporation or, other than for purposes of the definition of "Change of
Control" and "Continuing Directors," any committee thereof duly authorized
to act on behalf of such board; and
(2) with respect to any other Person, the functional equivalent of a
board of directors of a corporation or, other than for purposes of the
definition of "Change of
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Control" and "Continuing Directors," any committee thereof duly authorized
to act on behalf thereof.
"BUSINESS DAY" means a day other than a Saturday, Sunday or other
day on which banking institutions in New York or Montreal, Quebec are authorized
or required by law to close.
"CANADIAN DOLLAR EQUIVALENT" means, as to any amount denominated in
U.S. Dollars as of any date of determination, the amount of Canadian Dollars
which would be required to purchase such amount of U.S. Dollars at the Bank of
Canada noon (Toronto time) spot rate on such date or, if such date of
determination is not a Business Day, on the Business Day immediately preceding
such date of determination.
"CANADIAN HOLDING COMPANY" means MAAX Canada Inc., a corporation
governed by the Canada Business Corporations Act, and its predecessors.
"CAPITAL LEASE OBLIGATION" means, at the time any determination is
to be made, the amount of the liability in respect of a capital lease that would
at that time be required to be capitalized on a balance sheet in accordance with
GAAP.
"CAPITAL STOCK" means:
(1) in the case of a corporation or unlimited company, corporate
stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership interests (whether general or limited) or membership
interests; and
(4) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person, but excluding from all of the foregoing any
debt securities convertible into Capital Stock, whether or not such debt
securities include any right of participation with Capital Stock.
"CASH EQUIVALENTS" means, as at any date of determination, (1)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States or Canada and maturing within one
year of the date of acquisition thereof or (b) issued by any agency of the
United States or Canada the obligations of which are backed by the full faith
and credit of the United States or Canada, in each case maturing within one year
after the date of acquisition thereof; (2) marketable direct obligations issued
by any state of the United States of America or province of Canada or any
political subdivision of any such state or province or any public
instrumentality thereof, in each case maturing within one year after the date of
acquisition thereof and having a rating of at least A 2 from Standard & Poor's
Rating Services or at least P 2 from Xxxxx'x Investors Service, Inc.; (3)
commercial paper maturing no more than one year from the date of acquisition
thereof and having a rating of at least A 2 from
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S&P, at least P 2 from Moody's or at least R 2 (high) from Dominion Bond Rating
Services Limited; (4) certificates of deposit, time deposits or bankers'
acceptances maturing within one year after the date of acquisition thereof and
issued or accepted by any lender under any Credit Facility or by any commercial
bank organized under the laws of the United States of America or any state
thereof or the District of Columbia that is at least "adequately capitalized"
(as defined in the regulations of its primary Federal banking regulator) and has
Tier 1 capital (as defined in such regulations) of not less than US$100.0
million; (5) financial instruments maturing within one year after the date of
acquisition thereof and issued by any Canadian chartered bank which has a
long-term debt rating of at least A+ by S&P, A2 by Moody's or A (high) by
Dominion Bond Rating Services Limited; (6) repurchase agreements with a term of
not more than 30 days for underlying securities of the types described in clause
(1) or (2) entered into with any bank meeting the qualifications specified in
clause (4) or (5), which repurchase obligations are secured by a perfected first
priority security interest in the underlying securities; (7) shares of any money
market mutual fund that (a) has substantially all of its assets invested
continuously in the types of investments referred to in clauses (1) and (5)
above, (b) has net assets of not less than US$500.0 million and (c) has the
highest rating obtainable from either S&P or Moody's; and (8) in the case of any
European Subsidiary, investments made locally of a type comparable to those
described in clauses (1) through (7) of this definition.
"CHANGE OF CONTROL" means the occurrence of any of the following:
(1) the direct or indirect sale, transfer, conveyance or other
disposition (other than by way of merger, amalgamation or consolidation),
in one or a series of related transactions, of all or substantially all of
the properties or assets of Holdings and its Subsidiaries taken as a whole
to any "person" (as that term is used in Section 13(d) of the Exchange
Act) other than an Equity Sponsor or a Control Investment Affiliate of an
Equity Sponsor;
(2) the adoption of a plan relating to the liquidation or
dissolution of Holdings or the Issuer (other than a transaction that
complies with the provisions of Section 5.01);
(3) the consummation of any transaction (including, without
limitation, any merger, amalgamation or consolidation), the result of
which is that any "person" (as defined in clause (1) above) other than an
Equity Sponsor or a Control Investment Affiliate of an Equity Sponsor
becomes the Beneficial Owner, directly or indirectly, of Voting Stock of
Holdings representing 50% or more of the total voting power of the Voting
Stock of Holdings; provided that this clause (3) shall not be deemed to be
triggered by any Person that is deemed to be a Beneficial Owner of Voting
Stock of the Issuer by virtue of its relationship with (other than
ownership directly or indirectly of Capital Stock of) an Equity Sponsor or
a Control Investment Affiliate of an Equity Sponsor;
(4) after an initial public offering of Holdings or any Parent
Company, the first day on which a majority of the members of the Board of
Directors of Holdings are not Continuing Directors; provided, however,
that the Equity Sponsor and their Control Investment Affiliates do not, at
such time, in the aggregate, (a) Beneficially Own, directly or indirectly,
Voting Stock of Holdings representing more than 50% of the total voting
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power of the Voting Stock of Holdings or (b) have the right or ability by
voting power, contract or otherwise to elect or designate a majority of
the Board of Directors of Holdings; or
(5) Holdings shall cease to Beneficially Own all of the Equity
Interests of the Issuer.
"CONSOLIDATED CASH FLOW" means, for any period, for any Person, an
amount determined for such Person and its Restricted Subsidiaries on a
consolidated basis equal to
(i) Consolidated Net Income for such period plus
(ii) the sum, without duplication, of the amounts for such Person
and its Restricted Subsidiaries for such period (in each case to the
extent reducing such Consolidated Net Income) of
(a) Fixed Charges;
(b) provision for taxes based on income;
(c) total depreciation expenses;
(d) total amortization expenses;
(e) other non-cash items reducing such Consolidated Net Income
(excluding any such non-cash item to the extent that it represents
an accrual or reserve for potential cash items in any future period
or amortization of a prepaid cash item that was paid in a prior
period);
(f) relocation costs and expenses incurred to move the
headquarters of Holdings and its Subsidiaries from Sainte-Xxxxx,
Canada to Montreal, Canada;
(g) costs and expenses incurred on or prior to the Issue Date
during the fiscal year ending February 28, 2005 in connection with
the transactions described under "Use of Proceeds" in the Offering
Circular;
(h) Restructuring Expenses in an aggregate amount not to
exceed US$5.0 million in any four-quarter period;
(i) other non-recurring, non-operating losses in an aggregate
amount not to exceed US$5.0 million in any four-quarter period;
(j) cash gains realized under Hedging Obligations relating to
currency exchange rates; and
(k) minority interest (if negative) with respect to any
Subsidiary Guarantor; minus
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(iii) the sum, without duplication, of the amounts for such period
(in each case to the extent increasing such Consolidated Net Income) of
(a) non-cash items increasing such Consolidated Net Income
(excluding any such non-cash item to the extent it represents the
reversal of an accrual or reserve for potential cash item in any
prior period);
(b) non-recurring, non-operating gains;
(c) cash losses realized under Hedging Obligations relating to
currency exchange rates; and
(d) minority interest (if positive) with respect to any
Subsidiary Guarantor; plus or minus
(iv) without duplication of any amounts referred to above or in the
definition of Consolidated Net Income, with respect to any part of a
four-quarter period that is part of the fiscal year ended February 29,
2004, the pro forma adjustments to net income set forth in the section
"Unaudited Pro Forma Financial Data" in the Offering Circular and the
adjustments to net income to derive "EBITDA" and to "EBITDA" to derive
"Adjusted EBITDA" set forth in the section "Summary -- Summary Historical
and Pro Forma Consolidated Financial Data" in the Offering Circular;
provided that the items listed in clauses (ii)(a) through (e) of a Restricted
Subsidiary shall be included in Consolidated Cash Flow only to the extent (and
in the same proportion) that the net income of such Subsidiary was included in
calculating Consolidated Net Income for such period.
"CONSOLIDATED NET INCOME" means, for any period, the net income (or
net loss) of Holdings and the Restricted Subsidiaries for such period as
determined on a consolidated basis in accordance with GAAP, adjusted to the
extent included in calculating such net income or loss by excluding:
(1) any net after-tax extraordinary gains or losses (less all fees
and expenses relating thereto);
(2) any net after-tax gains or losses (less all fees and expenses
relating thereto) attributable to Asset Sales, dispositions of securities
or returned surplus assets of any pension plan;
(3) the net income (but not the net loss) of any Person that is not
a Restricted Subsidiary or that is accounted for by the equity method of
accounting, except to the extent of the amount of dividends or other
distributions actually paid to Holdings or any Restricted Subsidiary in
cash during such period;
(4) the net income (but not the net loss) of any Restricted
Subsidiary to the extent that the declaration or payment of dividends or
similar distributions by such Restricted Subsidiary is at the date of
determination prohibited, directly or indirectly, except to the extent
that such net income is actually paid to Holdings or any Restricted
7
Subsidiary by loans, advances, intercompany transfers, principal
repayments or otherwise; and
(5) the cumulative effect of a change in accounting principles;
provided, further, that Consolidated Net Income shall be reduced by (A) the
product of (x) the amount of all dividends on Designated Preferred Stock (other
than dividends paid in Qualified Equity Interests) paid, accrued or scheduled to
be paid or accrued during such period times (y) a fraction, the numerator of
which is one and the denominator of which is one minus the then current combined
federal, state, provincial and local statutory tax rate of Holdings and its
Subsidiaries, expressed as a decimal, and (B) payments made to any Parent
Company pursuant to clause (8) of Section 4.14(b).
"CONSOLIDATED NET TANGIBLE ASSETS" means the aggregate amount of
assets of Holdings (less applicable reserves and other properly deductible
items) after deducting therefrom (to the extent otherwise included therein) (a)
all current liabilities (other than the obligations under this Indenture or
current maturities of long-term Indebtedness), and (b) all goodwill, trade
names, trademarks, patents, unamortized debt discount and expense and other like
intangibles, all as set forth on the books and records of Holdings and the
Restricted Subsidiaries on a consolidated basis and in accordance with GAAP.
"CONTINUING DIRECTORS" means, as of any date of determination, any
member of the Board of Directors of Holdings who:
(1) was a member of such Board of Directors on the Issue Date;
(2) was nominated for election or elected to such Board of Directors
with the approval of a majority of the Continuing Directors who were
members of such Board of Directors at the time of such nomination or
election; or
(3) was nominated by one or more of the Equity Sponsors or their
Control Investment Affiliates.
"CONTROL INVESTMENT AFFILIATE" means, as to any Person, any other
Person which directly or indirectly is in control of, is controlled by, or is
under common control with such Person and is organized by such Person (or any
Person controlling such Person) primarily for making equity or debt investments
in portfolio companies.
"CORPORATE TRUST OFFICE" means the corporate trust office of the
Trustee located at 000 Xxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, XX 00000, Attention:
Corporate Trust Services, or such other office, designated by the Trustee by
written notice to the Issuer, at which at any particular time its corporate
trust business shall be administered.
"CREDIT AGREEMENT" means that certain credit agreement dated on or
about the Issue Date, by and among Holdings, the Issuer, certain subsidiaries of
the Issuer, Xxxxxxx Sachs Credit Partners L.P., Royal Bank of Canada and Xxxxxxx
Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated and certain of
their affiliates and the lenders from time to time party thereto, including any
related notes, guarantees, collateral documents, instruments and
8
agreements executed in connection therewith, and in each case, as amended,
restated, modified, renewed, refunded, replaced (whether upon termination or
otherwise) or refinanced (including by means of sales of debt securities to
institutional investors) in whole or in part from time to time.
"CREDIT FACILITIES" means one or more debt facilities (including,
without limitation, the Credit Agreement) or commercial paper facilities, in
each case, with banks or other institutional lenders providing for revolving
credit loans, term loans, receivables financing (including through the sale of
receivables to such lenders or to special purpose entities formed to borrow from
such lenders against such receivables) or letters of credit, in each case, as
amended, restated, modified, renewed, refunded, replaced or refinanced
(including by means of sales of debt securities to institutional investors) in
whole or in part from time to time.
"CUSTODIAN" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
"DAYLIGHT LOANS" means Indebtedness owed by Holdings to a third
party; provided that, on the date of incurrence of such Indebtedness, (i)
Holdings shall use all of the proceeds of such Indebtedness to subscribe and pay
for shares to be issued by Canadian Holding Company, (ii) Canadian Holding
Company shall use all of the proceeds of such issuance and sale to make payments
to the Issuer in respect of the Special Intercompany Note, (iii) the Issuer
shall dividend or otherwise distribute (whether by an interest-free advance or
otherwise) to Holdings all of such payments received by it and (iv) Holdings
shall use such dividend or other distribution to repay all Indebtedness owed by
it referred to in this definition.
"DEFAULT" means any event that is, or with the passage of time or
the giving of notice or both would be, an Event of Default.
"DEPOSITORY" means The Depository Trust Company, New York, New York,
or a successor thereto registered under the Exchange Act or other applicable
statute or regulation.
"DESIGNATED PREFERRED STOCK" means preferred stock (including,
without limitation, Disqualified Stock) issued and sold for cash in a bona fide
financing transaction that is designated as Designated Preferred Stock pursuant
to an Officers' Certificate on the issuance date thereof, the net cash proceeds
of which are excluded from the calculation set forth in clause (3) of the first
paragraph of Section 4.11 and are not used for purposes of clause (b) of the
second paragraph thereof.
"DESIGNATED SENIOR DEBT" means (1) the Credit Facility and all
Hedging Obligations with respect thereto and (2) any other Senior Debt permitted
under this Indenture (a) the principal amount of which is US$25.0 million or
more and (b) that has been designated by the Issuer as "Designated Senior Debt."
"DISQUALIFIED STOCK" means any Capital Stock that, by its terms (or
by the terms of any security into which it is convertible, or for which it is
exchangeable, in each case, at the option of the holder of the Capital Stock),
or upon the happening of any event, matures or is mandatorily redeemable,
pursuant to a sinking fund obligation or otherwise, or redeemable at the option
of the holder of the Capital Stock, in whole or in part, on or prior to the date
that is 91 days after the date on which the Notes mature. Notwithstanding the
preceding sentence, any
9
Capital Stock that would constitute Disqualified Stock solely because the
holders of the Capital Stock have the right to require the issuer to repurchase
such Capital Stock upon the occurrence of a change of control or an asset sale
shall not constitute Disqualified Stock if the asset sale or change of control
provisions applicable to such Capital Stock provide that the issuer may not
repurchase or redeem any such Capital Stock pursuant to such provisions unless
such repurchase or redemption complies with Section 4.11. The amount of
Disqualified Stock deemed to be outstanding at any time for purposes of this
Indenture shall be the maximum amount that Holdings and the Restricted
Subsidiaries may become obligated to pay upon the maturity of, or pursuant to
any mandatory redemption provisions of, such Disqualified Stock.
"EQUITY INTERESTS" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"EQUITY OFFERING" means (i) any issuance and sale by Holdings of its
Qualified Equity Interests or by any Parent Company of its Equity Interests;
provided, however, that in the case of an issuance and sale of Equity Interests
of any Parent Company, cash proceeds therefrom equal to not less than 100% of
the aggregate principal amount of any Notes to be redeemed are received by
Holdings as a contribution to its common equity capital or consideration for the
issuance and sale of Qualified Equity Interests immediately prior to such
redemption or (ii) any issuance and sale by Holdings of its Qualified Equity
Interests in connection with the conversion of Holdings to an income trust or by
any Parent Company or any Affiliate of Holdings (other than any of its
Subsidiaries) of its Equity Interests in connection with the conversion of such
Parent Company or Affiliate to an income trust; provided, however, that in the
case of an issuance and sale of Equity Interests of such Parent Company or
Affiliate, cash proceeds therefrom equal to not less than 100% of the aggregate
principal amount of any Notes to be redeemed are received by Holdings as a
contribution to its common equity capital or consideration for the issuance and
sale of Qualified Equity Interests immediately prior to such redemption.
"EQUITY SPONSORS" means Xxxx X. Childs, X.X. Childs Equity Funding
III, Borealis Private Equity Limited Partnership, Borealis (QLP) Private Equity
Limited Partnership and Ontario Municipal Employees Retirement Board.
"EUROPEAN SUBSIDIARIES" means any Subsidiary of the Issuer which was
not formed under the laws of the United States or any state of the United States
or the District of Columbia or under the laws of Canada or any province or
territory thereof.
"EXCHANGE ACT" means the U.S. Securities Exchange Act of 1934, as
amended.
"EXCHANGE OFFER" means an offer that may be made by the Issuer
pursuant to the Registration Rights Agreement to exchange Notes bearing the
Private Placement Legend for the Exchange Securities.
"EXCHANGE OFFER REGISTRATION STATEMENT" has the meaning given to
such term in the Registration Rights Agreement.
10
"EXCHANGE SECURITIES" has the meaning set forth in the Registration
Rights Agreement.
"EXISTING INDEBTEDNESS" means Indebtedness of the Issuer and its
Subsidiaries (other than Indebtedness under the Credit Agreement) in existence
on the date of this Indenture after giving effect to the issuance of the Notes
and the borrowing under the Credit Agreement on the Issue Date and the use of
proceeds therefrom, until such amounts are repaid.
"FAIR MARKET VALUE" means the value that would be paid by a willing
buyer to an unaffiliated willing seller in a transaction not involving distress
or necessity of either party, determined in good faith by the Board of Directors
of the Issuer.
"FIXED CHARGE COVERAGE RATIO" means, with respect to any specified
Person for any period, the ratio of the Consolidated Cash Flow of such Person
for such period to the Fixed Charges of such Person for such period. In the
event that the specified Person or any Restricted Subsidiary incurs, assumes,
guarantees, repays, repurchases, redeems, defeases or otherwise discharges any
Indebtedness (other than ordinary working capital borrowings) or issues,
repurchases or redeems preferred stock subsequent to the commencement of the
period for which the Fixed Charge Coverage Ratio is being calculated and on or
prior to the date on which the event for which the calculation of the Fixed
Charge Coverage Ratio is made occurred (the "CALCULATION DATE"), then the Fixed
Charge Coverage Ratio shall be calculated giving pro forma effect to such
incurrence, assumption, guarantee, repayment, repurchase, redemption, defeasance
or other discharge of Indebtedness, or such issuance, repurchase or redemption
of preferred stock, and the use of the proceeds therefrom, as if the same had
occurred at the beginning of the applicable four-quarter reference period.
In addition, for purposes of calculating the Fixed Charge Coverage
Ratio:
(1) acquisitions that have been made by the specified Person or any
Restricted Subsidiary, including through mergers or consolidations, or any
Person or any Restricted Subsidiary acquired by the specified Person or
any Restricted Subsidiary, and including any related financing
transactions and including increases in ownership of Restricted
Subsidiaries, during the four-quarter reference period or subsequent to
such reference period and on or prior to the Calculation Date shall be
given pro forma effect (in accordance with Regulation S-X under the
Securities Act but giving effect to Pro Forma Cost Savings) as if they had
occurred on the first day of the four-quarter reference period;
(2) the Consolidated Cash Flow attributable to operations or
businesses (and ownership interests therein) disposed of prior to the
Calculation Date shall be excluded;
(3) the Fixed Charges attributable to operations or businesses (and
ownership interests therein) disposed of prior to the Calculation Date
shall be excluded, but only to the extent that the obligations giving rise
to such Fixed Charges shall not be obligations of the specified Person or
any Restricted Subsidiary following the Calculation Date;
(4) any Person that is a Restricted Subsidiary on the Calculation
Date (or would become a Restricted Subsidiary on such Calculation Date in
connection with the
11
transaction requiring determination of such Consolidated Cash Flow) shall
be deemed to have been a Restricted Subsidiary at all times during such
four-quarter period;
(5) any Person that is not a Restricted Subsidiary on the
Calculation Date (or would cease to be a Restricted Subsidiary on such
Calculation Date in connection with the transaction requiring
determination of such Consolidated Cash Flow) shall be deemed not to have
been a Restricted Subsidiary at any time during such four-quarter period;
and
(6) if any Indebtedness bears a floating rate of interest, the
interest expense on such Indebtedness shall be calculated as if the rate
in effect on the Calculation Date had been the applicable rate for the
entire period (taking into account any Hedging Obligation applicable to
such Indebtedness if such Hedging Obligation has a remaining term as at
the Calculation Date in excess of 12 months).
"FIXED CHARGES" means, with respect to any specified Person for any
period, the sum, without duplication, of:
(1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued,
including, without limitation, amortization of debt issuance costs and
original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component of
all payments associated with Capital Lease Obligations, commissions,
discounts and other fees and charges incurred in respect of letter of
credit or bankers' acceptance financings, and net of the effect of all
payments made or received pursuant to Hedging Obligations in respect of
interest rates; plus
(2) the consolidated interest of such Person and its Restricted
Subsidiaries that was capitalized during such period; plus
(3) any interest accruing on Indebtedness of another Person that is
guaranteed by such Person or one of its Restricted Subsidiaries or secured
by a Lien on assets of such Person or one of its Restricted Subsidiaries,
whether or not such guarantee or Lien is called upon; plus
(4) the product of (a) all dividends, whether paid or accrued and
whether or not in cash, on any series of preferred stock of such Person or
any Restricted Subsidiary, other than dividends on Equity Interests
payable solely in Equity Interests of the Issuer (other than Disqualified
Stock) or to the Issuer or a Restricted Subsidiary of the Issuer, times
(b) a fraction, the numerator of which is one and the denominator of which
is one minus the then current combined federal, state and local statutory
tax rate of such Person, expressed as a decimal, in each case, on a
consolidated basis and in accordance with GAAP.
"GAAP" means generally accepted accounting principles in the United
States of America, as set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as
12
have been approved by a significant segment of the accounting profession which
are in effect from time to time.
"GOVERNMENT SECURITIES" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"GUARANTEE" means a guarantee other than by endorsement of
negotiable instruments for collection in the ordinary course of business, direct
or indirect, in any manner, including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness (whether arising by virtue of
partnership arrangements, or by agreements to keep well, to purchase assets,
goods, securities or services, to take or pay or to maintain financial statement
condition or otherwise).
"GUARANTEE" OR "NOTE GUARANTEE" means the guarantee by each
Guarantor of the Issuer's obligations under this Indenture and on the Notes,
executed pursuant to the provisions of this Indenture.
"GUARANTORS" means Holdings and the Subsidiary Guarantors.
"HEDGING OBLIGATIONS" of any Person means the obligations of such
Person under swap, cap, collar, forward purchase or similar agreements or
arrangements dealing with interest rates, currency exchange rates or commodity
prices, either generally or under specific contingencies.
"HOLDER" means any registered Holder, from time to time, of the
Notes.
"HOLDINGS" means Beauceland Corporation, a Nova Scotia unlimited
company.
"INDEBTEDNESS" means, with respect to any specified Person, any
indebtedness of such Person (excluding accrued expenses and trade payables),
whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof);
(3) in respect of bankers' acceptances;
(4) representing Capital Lease Obligations;
(5) representing the balance deferred and unpaid of the purchase
price of any property or services due more than six months after such
property is acquired or such services are completed, except any such
balance that represents an accrued expense or trade payable; or
(6) representing any Hedging Obligations,
13
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person), but only to the extent that the aggregate amount of such
Indebtedness does not exceed the Fair Market Value of the asset, and, to the
extent not otherwise included, the guarantee by the specified Person of any
Indebtedness of any other Person. In no event shall obligations or liabilities
in respect of any Capital Stock constitute Indebtedness hereunder.
"INDENTURE" means this Indenture, as amended or supplemented from
time to time in accordance with the terms hereof.
"INITIAL GLOBAL NOTES" has the meaning given to such term in Section
2.01.
"INITIAL NOTES" has the meaning given to such term in Section 2.02.
"INITIAL PURCHASERS" means Xxxxxxx, Xxxxx & Co., Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated and RBC Capital Markets Corporation.
"INSTITUTIONAL ACCREDITED INVESTOR" or "IAI" means an "accredited
investor" with the meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"INTEREST" means, with respect to the Notes, interest and Special
Interest, if any, on the Notes.
"INTEREST PAYMENT DATE" means the Stated Maturity of an installment
of interest on the Notes.
"INVESTMENTS" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates) in
the forms of loans (including guarantees or other obligations), advances or
capital contributions, purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities, together with all items that
are or would be classified as investments on a balance sheet prepared in
accordance with GAAP. If Holdings or any Restricted Subsidiary sells or
otherwise disposes of any Equity Interests of any Restricted Subsidiary such
that, after giving effect to any such sale or disposition, such Person is no
longer a Restricted Subsidiary, Holdings shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the Fair Market
Value of Holdings' Investments in such Restricted Subsidiary that were not sold
or disposed of in an amount determined as provided in the penultimate paragraph
of Section 4.11. The acquisition by Holdings or any Restricted Subsidiary of a
Person that holds an Investment in a third Person shall be deemed to be an
Investment by Holdings or such Restricted Subsidiary in such third Person in an
amount equal to the Fair Market Value of the Investments held by the acquired
Person in such third Person in an amount determined as provided in the
penultimate paragraph of Section 4.11. Except as otherwise provided in this
Indenture, the amount of an Investment shall be determined at the time the
Investment is made and without giving effect to subsequent changes in value.
Notwithstanding the foregoing, Restricted Payments of the type described in
clause (ii) of the definition thereof shall not be deemed to be Investments.
14
"ISSUE DATE" means June 4, 2004.
"LIEN" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest, hypothec or encumbrance of any kind in respect of
such asset, whether or not filed, recorded, registered or otherwise perfected
under applicable law, including any conditional sale or other title retention
agreement; provided that in no event shall an operating lease that is not a
Capital Lease Obligation be deemed to constitute a Lien.
"MATURITY DATE" means June 15, 2012.
"MOODY'S" means Xxxxx'x Investors Service, Inc. and its successors.
"NET PROCEEDS" means the aggregate cash proceeds received by
Holdings or any Restricted Subsidiary in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of the direct costs
relating to such Asset Sale, including, without limitation, (a) fees and
expenses related to such Asset Sale (including legal, accounting and investment
banking fees and discounts, and sales and brokerage commissions, and any
relocation expenses incurred as a result of the Asset Sale), (b) taxes paid or
payable as a result of the Asset Sale, in each case, after taking into account
any available tax credits or deductions and any tax sharing arrangements, (c)
amounts required to be applied to the repayment of Indebtedness, other than
Indebtedness under a Credit Facility, secured by a Lien on the asset or assets
that were the subject of such Asset Sale, (d) any reserve in accordance with
GAAP against any liabilities associated with such Asset Sale and retained by the
seller after such Asset Sale, including pension and other post-employment
benefit liabilities, liabilities related to environmental matters and
liabilities under any indemnification obligations associated with such Asset
Sale and (e) cash escrows (until released from escrow to the seller).
"NON-RECOURSE DEBT" means Indebtedness:
(1) as to which neither Holdings nor any Restricted Subsidiary (a)
provides credit support of any kind (including any undertaking, agreement
or instrument that would constitute Indebtedness), (b) is directly or
indirectly liable as a guarantor or otherwise, or (c) constitutes the
lender;
(2) no default with respect to which would permit upon notice, lapse
of time or both any Holder of any Indebtedness of Holdings or any
Restricted Subsidiary to declare a default on such Indebtedness or cause
the payment of the Indebtedness to be accelerated or payable prior to its
Stated Maturity; and
(3) as to which the lenders have been notified in writing that they
will not have any recourse to the stock or assets of Holdings or any
Restricted Subsidiary.
"NON-U.S. PERSON" has the meaning assigned to such term in
Regulation S.
"NOTE GUARANTEE" means the subordinated guarantee by each Guarantor
of the Issuer's payment obligations under this Indenture and the Notes, executed
pursuant to this Indenture.
15
"NOTES" means, collectively, the Issuer's 9.75% Senior Subordinated
Notes due 2012 issued in accordance with Section 2.02 (whether issued on the
Issue Date, issued as Additional Notes, issued as Exchange Securities or
otherwise issued after the Issue Date) treated as a single class of securities
under this Indenture, as amended or supplemented from time to time in accordance
with the terms of this Indenture.
"OBLIGATIONS" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"OFFERING CIRCULAR" means the offering circular of the Issuer
relating to the Notes dated May 27, 2004.
"OFFICER" means any of the following of the Issuer: the Chairman of
the Board of Directors, the Chief Executive Officer, the Chief Financial
Officer, the President, any Vice President, the Treasurer or the Secretary.
"OFFICERS' CERTIFICATE" means a certificate signed by two Officers.
"OPINION OF COUNSEL" means a written opinion from legal counsel who
is reasonably acceptable to the Trustee. The counsel may be an employee of, or
counsel to, the Issuer, a Guarantor or the Trustee.
"PARENT COMPANIES" means MAAX Holdings, Inc., a Delaware
corporation, and any of its Subsidiaries that directly or indirectly owns Equity
Interests of Holdings.
"PARI PASSU INDEBTEDNESS" means any Indebtedness of the Issuer or
any Guarantor that ranks pari passu in right of payment with the Notes or the
Guarantees, as applicable.
"PERMANENT REGULATION S GLOBAL NOTE" has the meaning given to such
term in Section 2.01.
"PERMITTED BUSINESS" means any business conducted by Holdings or any
Restricted Subsidiary on the Issue Date and any businesses that, in the good
faith judgment of the Board of Directors of Holdings, are reasonably related,
ancillary or complementary thereto, or reasonable extensions thereof.
"PERMITTED FACTORING ARRANGEMENTS" means the Sodex Factoring
Agreement, as amended from time to time, and other factoring agreements on
similar terms that, in each case, are not materially less favorable to Holdings,
as amended from time to time, and the Restricted Subsidiaries, taken as a whole,
than the arrangements contained in the Sodex Factoring Agreement, as in effect
on the Issue Date.
"PERMITTED INVESTMENTS" means:
(1) any Investment in Cash Equivalents;
16
(2) any Investment in Holdings or in a Restricted Subsidiary;
(3) any Investment by Holdings or any Restricted Subsidiary in a
Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary; or
(b) such Person is merged, consolidated or amalgamated with or
into, or transfers or conveys substantially all of its assets to, or
is liquidated into, Holdings or a Restricted Subsidiary;
(4) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.13;
(5) any Investment made for consideration consisting of Qualified
Equity Interests;
(6) any Investment received in compromise or resolution of (A)
obligations of trade creditors or customers that were incurred in the
ordinary course of business of Holdings or any Restricted Subsidiary,
including pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of any trade creditor or customer; or
(B) litigation, arbitration or other disputes with Persons that are not
Affiliates;
(7) Investments represented by Hedging Obligations permitted under
this Indenture;
(8) loans or advances to employees of Holdings or any of its
Subsidiaries (x) in the ordinary course of business in an aggregate amount
not to exceed US$5.0 million at any time outstanding or (y) in connection
with the purchase by such Persons of Equity Interests of Holdings or any
Parent Company so long as the cash proceeds of such purchase received by
any Parent Company are contemporaneously contributed to the common equity
capital of Holdings;
(9) Investments in existence on the Issue Date;
(10) Investments in prepaid expenses, negotiable instruments held
for collection and lease, endorsements for deposit or collection in the
ordinary course of business, utility or workers compensation, performance
and similar deposits entered into as a result of the operations of the
business in the ordinary course of business;
(11) pledges or deposits permitted under clause (6) of the
definition of Permitted Liens;
(12) receivables owing to Holdings or any Restricted Subsidiary if
created or acquired in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms as Holdings or such
Restricted Subsidiary deems reasonable under the circumstances; and
17
(13) other Investments in any Person having an aggregate Fair Market
Value (measured on the date each such Investment was made and without
giving effect to subsequent changes in value), when taken together with
all other Investments made pursuant to this clause (13) that are at the
time outstanding, not to exceed the greater of (x) US$20.0 million and (y)
7.0% of Consolidated Net Tangible Assets at such time.
"PERMITTED JUNIOR SECURITIES" means: (1) Equity Interests in
Holdings or any of its Subsidiaries; or (2) debt securities of the Issuer or any
Guarantor that are subordinated to all Senior Debt and any debt securities
issued in a confirmed plan of reorganization in exchange for Senior Debt to
substantially the same extent as, or to a greater extent than, the Notes and the
Guarantees are subordinated to Senior Debt pursuant to the provisions of this
Indenture.
"PERMITTED LIENS" means:
(1) Liens securing Senior Debt;
(2) Liens on assets of the Issuer or any Guarantor securing
Indebtedness and other Obligations under Credit Facilities and/or securing
Hedging Obligations;
(3) Liens in favor of Holdings or any Restricted Subsidiary;
(4) Liens on property (including Capital Stock) of a Person existing
at the time such Person is merged with or into or consolidated with
Holdings or any Subsidiary of Holdings; provided that such Liens were in
existence prior to the contemplation of such merger or consolidation and
do not extend to any assets other than those of the Person merged into or
consolidated with Holdings or the Subsidiary;
(5) Liens on property (including Capital Stock) existing at the time
of acquisition of the property by Holdings or any Subsidiary of Holdings;
provided that such Liens were in existence prior to, such acquisition, and
not incurred in contemplation of, such acquisition;
(6) Liens to secure the performance of statutory obligations, surety
or appeal bonds, performance bonds or other obligations of a like nature
incurred in the ordinary course of business;
(7) Liens to secure Indebtedness (including Capital Lease
Obligations) permitted by clause (4) of Section 4.10(b) covering only the
assets acquired with or financed by such Indebtedness;
(8) Liens existing on the date of this Indenture;
(9) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent more than 30 days or that are being contested
in good faith by appropriate proceedings promptly instituted and
diligently concluded; provided that any reserve or other appropriate
provision as is required in conformity with GAAP has been made therefor;
18
(10) Liens imposed by law, such as carriers', warehousemen's,
landlords', suppliers' and mechanics' Liens, in each case, incurred in the
ordinary course of business;
(11) survey exceptions, easements or reservations of, or rights of
others for, licenses, rights-of-way, sewers, electric lines, telegraph and
telephone lines and other similar purposes, or zoning or other
restrictions as to the use of real property that were not incurred in
connection with Indebtedness and that do not in the aggregate materially
adversely affect the operation of the business of the Issuer and its
Restricted Subsidiaries, taken as a whole;
(12) Liens created for the benefit of (or to secure) the Notes (or
the Guarantees) or payment obligations to the Trustee;
(13) Liens to secure any Permitted Refinancing Indebtedness
permitted to be incurred under this Indenture; provided, however, that the
new Lien shall be limited to all or part of the same property and assets
that secured or, under the written agreements pursuant to which the
original Lien arose, could secure the original Lien (plus improvements and
accessions to such property or proceeds or distributions thereof);
(14) judgment Liens not giving rise to an Event of Default;
(15) Liens and rights of setoff in favor of a bank imposed by law
and incurred in the ordinary course of business on deposit accounts
maintained with such bank and cash and Cash Equivalents in such accounts;
(16) Liens upon specific items of inventory or other goods and
proceeds of any Person securing such Person's obligations in respect of
bankers' acceptances issued or created for the account of such Person to
facilitate the purchase, shipment or storage of such inventory or other
goods;
(17) pledges or deposits by a Person under worker's compensation
laws, unemployment insurance laws or similar legislation, or good faith
deposits in connection with bids, tenders, contracts (other than for the
payment of Indebtedness) or leases to which such Person is a party, or
deposits as security for contested taxes or import duties or for the
payment of rent, in each case incurred in the ordinary course of business;
(18) Liens securing obligations under Permitted Factoring
Arrangements on the accounts receivable subject to Permitted Factoring
Arrangements; and
(19) Liens incurred in the ordinary course of business of Holdings
or any Restricted Subsidiary with respect to obligations that do not
exceed US$7.5 million at any one time outstanding.
"PERMITTED REFINANCING INDEBTEDNESS" means any Indebtedness of
Holdings or any Restricted Subsidiary issued in exchange for, or the net
proceeds of which are used to refund, refinance, replace, defease or discharge,
other Indebtedness of Holdings or any Restricted Subsidiary; provided that:
19
(1) the principal amount (or accreted value, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount
(or accreted value, if applicable) of the Indebtedness extended,
refinanced, renewed, replaced, defeased or refunded (plus all accrued
interest on the Indebtedness and the amount of all expenses and premiums
incurred in connection therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity
date not earlier than the final maturity date of, and has a Weighted
Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded;
(3) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the
Notes, such Permitted Refinancing Indebtedness is subordinated in right of
payment to, the Notes on terms at least as favorable to the Holders as
those contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by Holdings or by the
Restricted Subsidiary that is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"PERSON" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company, unlimited company or government or other entity.
"PRINCIPAL" means, with respect to the Notes, the principal of, and
premium, if any, on the Notes.
"PRIVATE PLACEMENT LEGEND" means the legends initially set forth on
the Notes in the form set forth in Exhibit B.
"PRO FORMA COST SAVINGS" means, with respect to any period, the
reductions in costs that occurred during the four-quarter period that are (1)
directly attributable to an asset acquisition and calculated on a basis that is
consistent with Article 11 of Regulation S-X under the Securities Act or (2)
implemented, committed to be implemented or the commencement of implementation
of which was begun in good faith by the business that was the subject of any
such asset acquisition within six months of the date of the asset acquisition
and that are supportable and quantifiable by the underlying records of such
business, as if, in the case of each of clauses (1) and (2), all such reductions
in costs had been effected as of the beginning of such period, decreased by any
incremental expenses incurred or to be incurred during the four-quarter period
in order to achieve such reduction in costs.
"QUALIFIED EQUITY INTERESTS" means Equity Interests of Holdings
other than Disqualified Stock.
"QUALIFIED INSTITUTIONAL BUYER" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
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"RECORD DATE" means the applicable Record Date specified in the
Notes; provided that if any such date is not a Business Day, the Record Date
shall be the first day immediately succeeding such specified day that is a
Business Day.
"REDEMPTION DATE," when used with respect to any Note to be
redeemed, means the date fixed for such redemption pursuant to this Indenture
and the Notes.
"REDEMPTION PRICE," when used with respect to any Note to be
redeemed, means the price fixed for such redemption, payable in immediately
available funds, pursuant to this Indenture and the Notes.
"REGISTRATION RIGHTS AGREEMENT" means (i) the Exchange and
Registration Rights Agreement dated as of the Issue Date among the Issuer, the
Guarantors and the initial purchasers of the Notes issued on the Issue Date and
(ii) any other exchange and registration rights agreement entered into in
connection with an issuance of Additional Notes in a private offering after the
Issue Date.
"REGULATION S" means Regulation S under the Securities Act.
"RELATED AGREEMENTS" means (i) the merger agreement and the
amalgamation agreement described in the section of the Offering Circular
entitled "Summary -- The Transactions"; and (ii) the purchase agreement and
registration rights agreement entered into in connection with the issuance of
Notes on the Issue Date and any other purchase or similar agreement and
registration rights agreement entered into in connection with the issuance of
Additional Notes.
"REPRESENTATIVE" means the Indenture Trustee or other trustee, agent
or representative in respect of any Designated Senior Debt; provided that if,
and for so long as, any Designated Senior Debt lacks such a representative, then
the Representative for such Designated Senior Debt shall at all times constitute
the holders of a majority in outstanding principal amount of such Designated
Senior Debt.
"RESPONSIBLE OFFICER" means, when used with respect to the Trustee,
any officer in the Corporate Trust Office of the Trustee to whom any corporate
trust matter is referred because of such officer's knowledge of and familiarity
with the particular subject and shall also mean any officer who shall have
direct responsibility for the administration of this Indenture.
"RESTRICTED INVESTMENT" means an Investment other than a Permitted
Investment.
"RESTRICTED SECURITY" means a Note that constitutes a "Restricted
Security" within the meaning of Rule 144(a)(3) under the Securities Act;
provided, however, that the Trustee shall be entitled to request and
conclusively rely on an Opinion of Counsel with respect to whether any Note
constitutes a Restricted Security.
"RESTRICTED SUBSIDIARY" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary. Unless otherwise
indicated, references to Restricted Subsidiaries shall be deemed to be to
Restricted Subsidiaries of Holdings, including the Issuer.
21
"RESTRUCTURING EXPENSES" means losses, expenses and charges incurred
in connection with restructuring by Holdings and/or one or more of the
Restricted Subsidiaries, including in connection with integration of acquired
businesses or Persons, disposition of one or more Restricted Subsidiaries or
businesses, exiting of one or more lines of business and relocation or
consolidation of facilities, including severance, lease termination and other
non-ordinary-course, non-operating costs and expenses in connection therewith.
"RULE 144A" means Rule 144A under the Securities Act.
"S&P" means Standard & Poor's Ratings Services, a division of the
XxXxxx-Xxxx Companies, Inc., and its successors.
"SEC" means the U.S. Securities and Exchange Commission.
"SECURITIES ACT" means the U.S. Securities Act of 1933, as amended.
"SENIOR DEBT" means the principal of, premium, if any, and interest
(including any interest accruing subsequent to the filing of a petition of
bankruptcy at the rate provided for in the documentation with respect thereto,
whether or not such interest is an allowed claim under applicable law) on any
Indebtedness of the Issuer or any Guarantor, whether outstanding on the Issue
Date or thereafter created, incurred or assumed, unless, in the case of any
particular Indebtedness, the instrument creating or evidencing the same or
pursuant to which the same is outstanding expressly provides that such
Indebtedness shall not be senior in right of payment to the Notes or the
Guarantee of such Guarantor.
Without limiting the generality of the foregoing, "Senior Debt"
shall include the principal of, premium, if any, interest (including any
interest accruing subsequent to the filing of a petition of bankruptcy at the
rate provided for in the documentation with respect thereto, whether or not such
interest is an allowed claim under applicable law) on, and all other amounts
owing in respect of:
(1) all monetary obligations of every nature under, or with respect
to, the Credit Facilities, including, without limitation, obligations to
pay principal and interest, reimbursement obligations under letters of
credit, fees, expenses and indemnities (and guarantees thereof); and
(2) all Hedging Obligations in respect of the Credit Facilities;
in each case whether outstanding on the Issue Date or thereafter incurred.
Notwithstanding the foregoing, "Senior Debt" shall not include:
(1) any Indebtedness owed to any Parent Company or any of its
Subsidiaries;
(2) obligations to trade creditors and other amounts incurred (but
not under the Credit Facilities) in connection with obtaining goods,
materials or services;
(3) any liability for taxes owed or owing by the Issuer or any
Guarantor;
22
(4) that portion of any Indebtedness incurred in violation of
Section 4.10 (but, as to any such obligation, no such violation shall be
deemed to exist for purposes of this clause (4) if the Holder(s) of such
obligation or their representative shall have received an Officers'
Certificate of the Issuer to the effect that the incurrence of such
Indebtedness does not (or, in the case of revolving credit Indebtedness,
that the incurrence of the entire committed amount thereof at the date on
which the initial borrowing thereunder is made would not) violate such
provisions of this Indenture);
(5) Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of Xxxxx 00, Xxxxxx Xxxxxx Code, is without
recourse to the Issuer or any Guarantor; and
(6) any Indebtedness which is, by its express terms, subordinated in
right of payment to any other Indebtedness of the Issuer or any Guarantor.
"SIGNIFICANT SUBSIDIARY" means any Subsidiary of Holdings that would
be a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation
S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect
on the date of this Indenture.
"SODEX FACTORING AGREEMENT" means that certain factoring agreement,
dated as of February 24, 2004, among MAAX Inc., MAAX Canada Inc., MAAX Spas
(Ontario) Inc., MAAX Westco Inc., MAAX Spas (BC) Inc., MAAX-KSD Corporation,
MAAX Southeast Inc., Pearl Baths, Inc., MAAX-Hydro Swirl Manufacturing Corp.,
MAAX Midwest Inc., MAAX Spas (Arizona), Inc., Cuisine Expert - C.E. Cabinets,
Inc., 0000-0000 Xxxxxx Inc., Xxxx Plastics Company Inc. and NatExport and Sodex,
both divisions of the National Bank of Canada.
"SPECIAL INTERCOMPANY NOTE" means that certain Note, dated on or
about the date of this Indenture, made by the Canadian Holding Company in favor
of the Issuer, as such Note may be amended, restated, supplemented or otherwise
modified from time to time.
"SPECIAL INTEREST" means (i) "Special Interest" as defined in the
registration rights agreement with respect to the Notes issued on the Issue Date
and (ii) "Special Interest", "Additional Interest", "Liquidated Damages" or any
similar term as such term is defined in any registration rights agreement with
respect to Additional Notes issued after the Issue Date.
"STATED MATURITY" means, with respect to any installment of interest
or principal on any series of Indebtedness, the date on which the payment of
interest or principal was scheduled to be paid in the documentation governing
such Indebtedness as of the date of this Indenture, and shall not include any
contingent obligations to repay, redeem or repurchase any such interest or
principal prior to the date originally scheduled for the payment thereof.
"SUBSIDIARY" means, with respect to any specified Person:
(1) any corporation, company, association or other business entity
of which more than 50% of the total voting power of shares of Capital
Stock entitled (without regard to the occurrence of any contingency and
after giving effect to any voting agreement or stockholders' agreement
that effectively transfers voting power) to vote in the election of
directors, managers or trustees of the corporation, association or other
23
business entity is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of
that Person (or a combination thereof); and
(2) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or
(b) the only general partners of which are that Person or one or more
Subsidiaries of that Person (or any combination thereof).
"SUBSIDIARY GUARANTOR" means each Subsidiary of the Issuer that
executes a Guarantee in accordance with the provisions of this Indenture and its
successors and assigns, until such Subsidiary is released from its Guarantee in
accordance with the provisions of this Indenture.
"TEMPORARY REGULATION S GLOBAL NOTE" has the meaning given to such
term in Section 2.01.
"TRANSACTIONS" has the meaning set forth in the Offering Circular
under the caption "Summary -- The Transactions."
"TREASURY RATE" means, with respect to a Redemption Date, the yield
to maturity at the time of computation of United States Treasury securities with
a constant maturity (as compiled and published in the most recent Federal
Reserve Statistical Release H.15(519) that has become publicly available at
least two Business Days prior to such Redemption Date (or, if such Statistical
Release is no longer published, any publicly available source of similar market
data)) most nearly equal to the period from such Redemption Date to the Fourth
Anniversary; provided, however, that if the period from such Redemption Date to
the Fourth Anniversary is not equal to the constant maturity of the United
States Treasury security for which a weekly average yield is given, the Treasury
Rate shall be obtained by linear interpolation (calculated to the nearest
one-twelfth of a year) from the weekly average yields of United States Treasury
securities for which such yields are given, except that if the period from such
Redemption Date to the Fourth Anniversary is less than one year, the weekly
average yield on actually traded United States Treasury securities adjusted to a
constant maturity of one year shall be used.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as
amended.
"TRUSTEE" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"UNRESTRICTED SUBSIDIARY" means any Subsidiary of Holdings (other
than the Issuer) that is designated by the Board of Directors of Holdings as an
Unrestricted Subsidiary pursuant to a Board Resolution, but only to the extent
that such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) except as permitted by Section 4.14, is not party to any
agreement, contract, arrangement or understanding with Holdings or any
Restricted Subsidiary unless the terms of any such agreement, contract,
arrangement or understanding are no
24
less favorable to Holdings or such Restricted Subsidiary than those that
might be obtained at the time from Persons that are not Affiliates of
Holdings;
(3) is a Person with respect to which neither Holdings nor any
Restricted Subsidiary has any direct or indirect obligation (a) to
subscribe for additional Equity Interests or (b) to maintain or preserve
such Person's financial condition or to cause such Person to achieve any
specified levels of operating results; and
(4) has not guaranteed or otherwise directly or indirectly provided
credit support for any Indebtedness of Holdings or any Restricted
Subsidiary.
Any designation of a Subsidiary of Holdings as an Unrestricted
Subsidiary shall be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
preceding conditions and was permitted by Section 4.11. If, at any time, any
Unrestricted Subsidiary would fail to meet the preceding requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary as of such
date and, if such Indebtedness is not permitted to be incurred as of such date
under Section 4.10, Holdings shall be in default of such covenant. The Board of
Directors of Holdings may at any time designate any Unrestricted Subsidiary to
be a Restricted Subsidiary; provided that such designation shall be deemed to be
an incurrence of Indebtedness by a Restricted Subsidiary of any outstanding
Indebtedness of such Unrestricted Subsidiary and such designation shall only be
permitted if (1) such Indebtedness is permitted under Section 4.10, calculated
on a pro forma basis as if such designation had occurred at the beginning of the
four-quarter reference period; and (2) no Default or Event of Default would be
in existence following such designation.
"U.S. DOLLAR EQUIVALENT" means, as to any amount denominated in
Canadian Dollars as of any date of determination, the amount of U.S. Dollars
which would be required to purchase such amount of Canadian Dollars at the Bank
of Canada noon (Toronto time) spot rate on such date or, if such date of
determination is not a Business Day, on the Business Day immediately preceding
such date of determination.
"U.S. LEGAL TENDER" means such coin or currency of the United States
of America that at the time of payment shall be legal tender for the payment of
public and private debts.
"VOTING STOCK" of any Person as of any date means the Capital Stock
of such Person that is at the time entitled to vote in the election of the Board
of Directors of such Person.
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the amount
of each then remaining installment, sinking fund, serial maturity or other
required payments of principal, including payment at final maturity, in
respect of the Indebtedness, by (b) the
25
number of years (calculated to the nearest one-twelfth) that shall elapse
between such date and the making of such payment; by
(2) the then outstanding principal amount of such Indebtedness.
SECTION 1.02. Other Definitions.
Term Defined in Section
-------------------------------------------------------------- ------------------
"acceleration declaration".................................... 6.02
"Additional Amounts".......................................... 4.21
"Additional Notes"............................................ 2.02
"Affiliate Transaction"....................................... 4.14
"Alternate Offer" ............................................ 4.09
"Asset Sale Offer" ........................................... 4.13
"Asset Sale Payment Date"..................................... 4.13
"Authentication Order"........................................ 2.02
"Authorized Agent"............................................ 12.14
"Change of Control Offer"..................................... 4.09
"Change of Control Payment"................................... 4.09
"Covenant Defeasance"......................................... 8.02
"Documentary Taxes"........................................... 4.21
"Event of Default"............................................ 6.01
"Excess Proceeds"............................................. 4.13
"Excluded Taxes".............................................. 4.21
"First Currency".............................................. 1.04
"Global Note"................................................. 2.01
"Guarantee Obligations"....................................... 11.01
"IAI Global Note"............................................. 2.01
"Incur"....................................................... 4.10
"Legal Defeasance"............................................ 8.03
"Non-Payment Default"......................................... 10.02
"Offered Price"............................................... 4.13
"Other Currency".............................................. 1.04
"Participants"................................................ 2.15
"Paying Agent"................................................ 2.03
"Payment Blockage Notice"..................................... 10.02
"Payment Blockage Period"..................................... 10.02
"Payment Default"............................................. 10.02
"Permitted Debt".............................................. 4.10
"Physical Notes".............................................. 2.01
"Registrar"................................................... 2.03
"Regulation S Global Note".................................... 2.01
"Relevant Taxing Jurisdiction"................................ 4.21
"Restricted Payments" ........................................ 4.11
"Taxes" ...................................................... 4.21
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SECTION 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the Trust Indenture
Act, such provision is incorporated by reference in, and made a part of, this
Indenture. The following Trust Indenture Act terms used in this Indenture have
the following meanings:
"indenture securities" means the Notes.
"indenture security Holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Issuer, any
Guarantor or any other obligor on the Notes.
All other Trust Indenture Act terms used in this Indenture that are
defined by the Trust Indenture Act, defined by Trust Indenture Act reference to
another statute or defined by SEC rule and not otherwise defined herein have the
meanings assigned to them therein.
SECTION 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the
plural include the singular;
(5) provisions apply to successive events and transactions;
(6) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other subdivision;
(7) the words "including," "includes" and similar words shall be
deemed to be followed by "without limitation;"
(8) references to "$" or dollars are to Canadian dollars and
references to "US$" and "U.S. dollars" are to U.S. dollars; and
(9) except as otherwise provided in this Indenture, for purpose of
the construction of this Indenture or of the Notes, in the event that any
amount is stated herein in the currency of one nation (the "FIRST
CURRENCY"), as of any date such amount
27
shall also be deemed to represent the amount in the currency of any other
relevant nation (the "OTHER CURRENCY") which is required to purchase such
amount in the First Currency at the Bank of Canada noon (Toronto time)
spot rate on the date of determination.
ARTICLE TWO
THE NOTES
SECTION 2.01. Form and Dating.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A hereto. The Notes may have notations,
legends or endorsements required by law, stock exchange rule or usage. The
Issuer shall approve the form of the Notes and any notation, legend or
endorsement on them. Each Note shall be dated the date of its issuance and show
the date of its authentication. Each Note shall have an executed Note Guarantee
from each of the Guarantors existing on the Issue Date endorsed thereon
substantially in the form of Exhibit F.
The terms and provisions contained in the Notes and the Note
Guarantees shall constitute, and are hereby expressly made, a part of this
Indenture and, to the extent applicable, the Issuer, the Guarantors and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby. However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.
Notes offered and sold in reliance on Rule 144A shall be issued
initially in the form of a single permanent global Note in registered form,
substantially in the form set forth in Exhibit A (the "144A GLOBAL NOTE"),
deposited with the Trustee, as custodian for the Depository, duly executed by
the Issuer (and having an executed Note Guarantee from each of the Guarantors
endorsed thereon) and authenticated by the Trustee as hereinafter provided and
shall bear the legends set forth in Exhibit B.
Notes offered and sold in offshore transactions in reliance on
Regulation S shall be issued initially in the form of a single temporary global
Note in registered form, substantially in the form of Exhibit A (the "TEMPORARY
REGULATION S GLOBAL NOTE"), deposited with the Trustee, as custodian for the
Depository, duly executed by the Issuer (and having an executed Note Guarantee
from each of the Guarantors endorsed thereon) and authenticated by the Trustee
as hereinafter provided and shall bear the legends set forth in Exhibit B.
Reasonably promptly following the date that is 40 days after the later of the
commencement of the offering of the Notes in reliance on Regulation S and the
Issue Date, upon receipt by the Trustee and the Issuer of a duly executed
certificate certifying that the Holder of the beneficial interest in the
Temporary Regulation S Global Note is a Non-U.S. Person, substantially in the
form of Exhibit E from the Depository, a single permanent global Note in
registered form substantially in the form of Exhibit A (the "PERMANENT
REGULATION S GLOBAL NOTE," and together with the Temporary Regulation S Global
Note, the "REGULATION S GLOBAL NOTE") duly executed by the Issuer (and having an
executed Note Guarantee from each of the Guarantors endorsed thereon) and
authenticated by the Trustee as hereinafter provided shall be deposited with the
28
Trustee, as custodian for the Depository, and the Registrar shall reflect on its
books and records the cancellation of the Temporary Regulation S Global Note and
the issuance of the Permanent Regulation S Global Note.
The initial offer and resale of the Notes shall not be to an
Institutional Accredited Investor. The Notes resold to Institutional Accredited
Investors in connection with the first transfer made pursuant to Section 2.16(a)
shall be issued initially in the form of a single permanent Global Note in
registered form, substantially in the form set forth in Exhibit A (the "IAI
GLOBAL NOTE," and, together with the 144A Global Note and the Regulation S
Global Note, the "INITIAL GLOBAL NOTES"), deposited with the Trustee, as
custodian for the Depository, duly executed by the Issuer (and having an
executed Note Guarantee from each of the Guarantors endorsed thereon) and
authenticated by the Trustee as hereinafter provided and shall bear the legend
set forth in Exhibit B.
Notes issued after the Issue Date shall be issued initially in the
form of one or more global Notes in registered form, substantially in the form
set forth in Exhibit A, deposited with the Trustee, as custodian for the
Depository, duly executed by the Issuer (and having an executed Note Guarantee
from each of the Guarantors endorsed thereon) and authenticated by the Trustee
as hereinafter provided and shall bear any legends required by applicable law
(together with the Initial Global Notes, the "GLOBAL NOTES") or as Physical
Notes.
The aggregate principal amount of the Global Notes may from time to
time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depository, as hereinafter provided. Notes issued
in exchange for interests in a Global Note pursuant to Section 2.16 may be
issued in the form of permanent certificated Notes in registered form in
substantially the form set forth in Exhibit A and bearing the applicable
legends, if any, (the "PHYSICAL NOTES").
SECTION 2.02. Execution, Authentication and Denomination; Additional Notes;
Exchange Securities
One Officer of the Issuer (who shall have been duly authorized by
all requisite corporate actions) shall sign the Notes for such Issuer by manual
or facsimile signature. One Officer of a Guarantor (who shall have been duly
authorized by all requisite corporate actions) shall sign the Note Guarantee for
such Guarantor by manual or facsimile signature.
If an Officer whose signature is on a Note or Note Guarantee, as the
case may be, was an Officer at the time of such execution but no longer holds
that office at the time the Trustee authenticates the Note, the Note shall
nevertheless be valid.
A Note (and the Note Guarantees in respect thereof) shall not be
valid until an authorized signatory of the Trustee manually signs the
certificate of authentication on the Note. The signature shall be conclusive
evidence that the Note has been authenticated under this Indenture.
The Trustee shall authenticate (i) on the Issue Date, Notes for
original issue in the aggregate principal amount not to exceed US$150,000,000
(the "INITIAL NOTES"), (ii) additional Notes (the "ADDITIONAL NOTES") having
identical terms and conditions to the Initial Notes, except
29
for issue date, issue price and first interest payment date, in an unlimited
amount (so long as not otherwise prohibited by the terms of this Indenture,
including, without limitation, Section 4.10) and (iii) Exchange Securities (x)
in exchange for a like principal amount of Initial Notes or (y) in exchange for
a like principal amount of Additional Notes in each case upon a written order of
the Issuer in the form of a certificate of an Officer of the Issuer (an
"AUTHENTICATION ORDER"). Each such Authentication Order shall specify the amount
of Notes to be authenticated and the date on which the Notes are to be
authenticated, whether the Notes are to be Initial Notes, Exchange Securities or
Additional Notes and whether the Notes are to be issued as certificated Notes or
Global Notes or such other information as the Trustee may reasonably request.
All Notes issued under this Indenture shall be treated as a single
class for all purposes under this Indenture. The Additional Notes shall bear any
legend required by applicable law.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Issuer to authenticate Notes. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Notes whenever the Trustee
may do so. Each reference in this Indenture to authentication by the Trustee
includes authentication by such agent. An authenticating agent has the same
rights as an Agent to deal with the Issuer and Affiliates of the Issuer. The
Trustee shall have the right to decline to authenticate and deliver any Notes
under this Indenture if the Trustee, being advised by counsel, determines that
such action may not lawfully be taken or if the Trustee in good faith shall
determine that such action would expose the Trustee to personal liability.
The Notes shall be issuable only in registered form without coupons
in denominations of US$1,000 and integral multiples of US$1,000 thereof.
SECTION 2.03. Registrar and Paying Agent.
The Issuer shall maintain or cause to be maintained an office or
agency in the Borough of Manhattan, The City of New York, where (a) Notes may be
presented or surrendered for registration of transfer or for exchange
("REGISTRAR"), (b) Notes may, subject to Section 2 of the Notes, be presented or
surrendered for payment ("PAYING AGENT") and (c) notices and demands to or upon
the Issuer in respect of the Notes and this Indenture may be served. The Issuer
may also from time to time designate one or more other offices or agencies where
the Notes may be presented or surrendered for any or all such purposes and may
from time to time rescind such designations; provided, however, that no such
designation or rescission shall in any manner relieve the Issuer of its
obligation to maintain or cause to be maintained an office or agency in the
Borough of Manhattan, The City of New York, for such purposes. Holdings or any
Subsidiary of Holdings may act as Registrar or Paying Agent, except that for the
purposes of Article Eight, neither the Issuer nor any Affiliate of the Issuer
shall act as Paying Agent. The Registrar shall keep a register of the Notes and
of their transfer and exchange. The Issuer, upon notice to the Trustee, may have
one or more co-registrars and one or more additional paying agents reasonably
acceptable to the Trustee. The term "Registrar" includes any co-registrar and
the term "Paying Agent" includes any additional paying agent. The Issuer
initially appoints the
30
Trustee as Registrar and Paying Agent until such time as the Trustee has
resigned or a successor has been appointed.
The Issuer shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which agreement shall implement the
provisions of this Indenture that relate to such Agent. The Issuer shall notify
the Trustee, in advance, of the name and address of any such Agent. If the
Issuer fails to maintain a Registrar or Paying Agent, the Trustee shall act as
such.
SECTION 2.04. Paying Agent To Hold Assets in Trust.
The Issuer shall require each Paying Agent other than the Trustee or
Holdings or any Subsidiary of Holdings to agree in writing that, subject to
Article Ten and Section 11.02, each Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all assets held by the Paying Agent for the
payment of principal of, premium or Special Interest, if any, or interest on,
the Notes (whether such assets have been distributed to it by the Issuer or any
other obligor on the Notes), and shall notify the Trustee of any Default by the
Issuer (or any other obligor on the Notes) in making any such payment. The
Issuer at any time may require a Paying Agent to distribute all assets held by
it to the Trustee and account for any assets disbursed and the Trustee may at
any time during the continuance of any Payment Default, upon written request to
a Paying Agent, require such Paying Agent to distribute all assets held by it to
the Trustee and to account for any assets distributed. Upon distribution to the
Trustee of all assets that shall have been delivered by the Issuer to the Paying
Agent, the Paying Agent (if other than Holdings or a Subsidiary of Holdings)
shall have no further liability for such assets. If Holdings or a Subsidiary of
Holdings acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy or reorganization proceedings relating to the Issuer, the Trustee
shall serve as Paying Agent for the Notes.
SECTION 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders and shall otherwise comply with TIA Section 312(a). If the Trustee is
not the Registrar, the Issuer shall furnish to the Trustee at least two (2)
Business Days prior to each Interest Payment Date and at such other times as the
Trustee may request in writing a list, in such form and as of such date as the
Trustee may reasonably require, of the names and addresses of Holders, which
list may be conclusively relied upon by the Trustee.
SECTION 2.06. Transfer and Exchange.
Subject to Sections 2.15 and 2.16, when Notes are presented to the
Registrar with a request to register the transfer of such Notes or to exchange
such Notes for an equal principal amount of Notes of other authorized
denominations, the Registrar shall register the transfer or make the exchange as
requested if its requirements for such transaction are met; provided, however,
that the Notes surrendered for transfer or exchange shall be duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Issuer and the
31
Registrar, duly executed by the Holder thereof or his or her attorney duly
authorized in writing. To permit registrations of transfers and exchanges, the
Issuer shall execute and the Trustee shall authenticate Notes at the Registrar's
request. No service charge shall be made for any registration of transfer or
exchange, but the Issuer may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith.
Without the prior written consent of the Issuer, the Registrar shall
not be required to register the transfer of or exchange of any Note (i) during a
period beginning at the opening of business 15 days before the mailing of a
notice of redemption of Notes and ending at the close of business on the day of
such mailing, (ii) selected for redemption in whole or in part pursuant to
Article Three, except the unredeemed portion of any Note being redeemed in part,
and (iii) beginning at the opening of business on any Record Date and ending on
the close of business on the related Interest Payment Date.
Any Holder of a beneficial interest in a Global Note shall, by
acceptance of such beneficial interest, agree that transfers of beneficial
interests in such Global Notes may be effected only through a book-entry system
maintained by the Holder of such Global Note (or its agent) in accordance with
the applicable legends thereon, and that ownership of a beneficial interest in
the Note shall be required to be reflected in a book-entry system.
SECTION 2.07. Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if the Holder
of a Note claims that the Note has been lost, destroyed or wrongfully taken, the
Issuer shall issue and the Trustee shall authenticate a replacement Note if the
Trustee's requirements are met. Such Holder must provide an indemnity bond or
other indemnity, sufficient in the judgment of both the Issuer and the Trustee,
to protect the Issuer, the Trustee or any Agent from any loss which any of them
may suffer if a Note is replaced. The Issuer may charge such Holder for its
reasonable expenses in replacing a Note pursuant to this Section 2.07, including
reasonable fees and expenses of counsel and of the Trustee.
Every replacement Note is an additional obligation of the Issuer and
every replacement Note Guarantee shall constitute an additional obligation of
the Guarantor thereof.
SECTION 2.08. Outstanding Notes.
Notes outstanding at any time are all the Notes that have been
authenticated by the Trustee except those cancelled by it, those delivered to it
for cancellation and those described in this Section as not outstanding. A Note
does not cease to be outstanding because the Issuer, the Guarantors or any of
their respective Affiliates hold the Note (subject to the provisions of Section
2.09).
If a Note is replaced pursuant to Section 2.07 (other than a
mutilated Note surrendered for replacement), it ceases to be outstanding unless
a Responsible Officer of the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser. A mutilated Note ceases to be
outstanding upon surrender of such Note and replacement thereof pursuant to
Section 2.07.
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If the principal amount of any Note is considered paid under Section
4.01, it ceases to be outstanding and interest ceases to accrue. If on a
Redemption Date or the Maturity Date the Trustee or Paying Agent (other than the
Issuer or an Affiliate thereof) holds U.S. Legal Tender or U.S. Government
Obligations sufficient to pay all of the principal and interest due on the Notes
payable on that date, then on and after that date such Notes cease to be
outstanding and interest on them ceases to accrue.
SECTION 2.09. Treasury Notes.
In determining whether the Holders of the required principal amount
of Notes have concurred in any direction, waiver or consent, Notes owned by the
Issuer or any of its Affiliates shall be disregarded, except that, for the
purposes of determining whether the Trustee shall be protected in relying on any
such direction, waiver or consent, only Notes that a Responsible Officer of the
Trustee actually knows are so owned shall be disregarded.
SECTION 2.10. Temporary Notes.
Until definitive Notes are ready for delivery, the Issuer may
prepare and the Trustee shall, upon receipt of an authentication order,
authenticate temporary Notes. Temporary Notes shall be substantially in the form
of definitive Notes but may have variations that the Issuer considers
appropriate for temporary Notes. Without unreasonable delay, the Issuer shall
prepare and the Trustee shall authenticate definitive Notes in exchange for
temporary Notes. Until such exchange, temporary Notes shall be entitled to the
same rights, benefits and privileges as definitive Notes. Notwithstanding the
foregoing, so long as the Notes are represented by a Global Note, such Global
Note may be in typewritten form.
SECTION 2.11. Cancellation.
The Issuer at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for transfer, exchange or payment. The Trustee, or
at the direction of the Trustee, the Registrar or the Paying Agent (other than
the Issuer or a Subsidiary), and no one else, shall cancel and, at the written
direction of the Issuer, shall dispose of all Notes surrendered for transfer,
exchange, payment or cancellation in accordance with its customary procedures.
Subject to Section 2.07, the Issuer may not issue new Notes to replace Notes
that it has paid or delivered to the Trustee for cancellation. If the Issuer or
any Guarantor shall acquire any of the Notes, such acquisition shall not operate
as a redemption or satisfaction of the Indebtedness represented by such Notes
unless and until the same are surrendered to the Trustee for cancellation
pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest.
If the Issuer defaults in a payment of interest on the Notes, it
shall pay the defaulted interest, plus (to the extent lawful) any interest
payable on the defaulted interest, in any lawful manner, in each case at the
rate provided in the Notes and in Section 4.01 hereof. The Issuer may pay the
defaulted interest to the persons who are Holders on a subsequent special record
date, which date shall be the fifteenth day next preceding the date fixed by the
Issuer for the payment of defaulted interest or the next succeeding Business Day
if such date is not a
33
Business Day. At least 15 days before any such subsequent special record date,
the Issuer or, at the Issuer's request, the Trustee, shall mail to each Holder,
with a copy to the Trustee, a notice that states the subsequent special record
date, the payment date and the amount of defaulted interest, and interest
payable on such defaulted interest, if any, to be paid.
SECTION 2.13. CUSIP and ISIN Numbers.
The Issuer in issuing the Notes may use "CUSIP" or "ISIN" numbers,
and if so, the Trustee shall use the "CUSIP" or "ISIN" numbers in notices of
redemption or exchange as a convenience to Holders; provided, however, that any
such notice may state that no representation is made as to the correctness or
accuracy of the "CUSIP" or "ISIN" numbers printed in the notice or on the Notes,
and that reliance may be placed only on the other identification numbers printed
on the Notes. The Issuer shall promptly notify the Trustee of any change in the
"CUSIP" or "ISIN" numbers.
SECTION 2.14. Deposit of Moneys.
Subject to Section 2 of the Notes, prior to 1:00 p.m. New York City
time on each Interest Payment Date, Maturity Date, Redemption Date, Change of
Control Payment Date and Asset Sale Payment Date, the Issuer shall have
deposited with the Paying Agent in immediately available funds money sufficient
to make cash payments, if any, due on such Interest Payment Date, Maturity Date,
Redemption Date, Change of Control Payment Date and Asset Sale Payment Date, as
the case may be, in a timely manner which permits the Paying Agent to remit
payment to the Holders on such Interest Payment Date, Maturity Date, Redemption
Date, Change of Control Payment Date and Asset Sale Payment Date, as the case
may be.
SECTION 2.15. Book-Entry Provisions for Global Notes.
(a) The Global Notes initially shall (i) be registered in the name
of the Depository or the nominee of such Depository, (ii) be delivered to the
Trustee as custodian for such Depository and (iii) bear legends as set forth in
Exhibit B, as applicable.
Members of, or participants in, the Depository ("PARTICIPANTS")
shall have no rights under this Indenture with respect to any Global Note held
on their behalf by the Depository, or the Trustee as its custodian, or under the
Global Note, and the Depository may be treated by the Issuer, the Trustee and
any agent of the Issuer or the Trustee as the absolute owner of the Global Note
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Issuer, the Trustee or any agent of the Issuer or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by the Depository or impair, as between the Depository and
Participants, the operation of customary practices governing the exercise of the
rights of a Holder of any Note.
(b) Transfers of Global Notes shall be limited to transfers in
whole, but not in part, to the Depository, its successors or their respective
nominees. Interests of beneficial owners in the Global Notes may be transferred
or exchanged for Physical Notes in accordance with the rules and procedures of
the Depository and the provisions of Section 2.16. In addition, Physical Notes
shall be transferred to all beneficial owners in exchange for their beneficial
interests in Global Notes if (i) (a) the Depository notifies the Issuer that it
is unwilling or unable
34
to act as Depository for any Global Note or (b) has ceased to be a clearing
agency registered under the Exchange Act, the Issuer so notifies the Trustee in
writing and a successor Depository is not appointed by the Issuer within 90 days
of such notice or (ii) an Event of Default has occurred and is continuing and
the Registrar has received a request from any owner of a beneficial interest in
a Global Note to issue Physical Notes. Upon any issuance of a Physical Note in
accordance with this Section 2.15(b) the Trustee is required to register such
Physical Note in the name of, and cause the same to be delivered to, such person
or persons (or the nominee of any thereof). All such Physical Notes shall bear
the applicable legends, if any.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in a Global Note to beneficial owners pursuant to paragraph
(b) of this Section 2.15, the Registrar shall (if one or more Physical Notes are
to be issued) reflect on its books and records the date and a decrease in the
principal amount of such Global Note in an amount equal to the principal amount
of the beneficial interest in the Global Note to be transferred, and the Issuer
shall execute, and the Trustee shall authenticate and deliver, one or more
Physical Notes of authorized denominations in an aggregate principal amount
equal to the principal amount of the beneficial interest in the Global Note so
transferred.
(d) In connection with the transfer of a Global Note as an entirety
to beneficial owners pursuant to paragraph (b) of this Section 2.15, such Global
Note shall be deemed to be surrendered to the Trustee for cancellation, and (i)
the Issuer shall execute, (ii) the Guarantors shall execute notations of Note
Guarantees on and (iii) the Trustee shall upon written instructions from the
Issuer authenticate and deliver, to each beneficial owner identified by the
Depository in exchange for its beneficial interest in such Global Note, an equal
aggregate principal amount of Physical Notes of authorized denominations.
(e) Any Physical Note constituting a Restricted Security delivered
in exchange for an interest in a Global Note pursuant to paragraph (b) or (c) of
this Section 2.15 shall, except as otherwise provided by Section 2.16, bear the
Private Placement Legend.
(f) The Holder of any Global Note may grant proxies and otherwise
authorize any Person, including Participants and Persons that may hold interests
through Participants, to take any action which a Holder is entitled to take
under this Indenture or the Notes.
SECTION 2.16. Special Transfer and Exchange Provisions.
(a) Transfers to Non-QIB Institutional Accredited Investors. The
following provisions shall apply with respect to the registration of any
proposed transfer of a Restricted Security to any Institutional Accredited
Investor which is not a QIB:
(i) the Registrar shall register the transfer of any Restricted
Security, whether or not such Note bears the Private Placement Legend, if
(x) the requested transfer is after the second anniversary of the Issue
Date; provided, however, that neither the Issuer nor any Affiliate of the
Issuer has held any beneficial interest in such Note, or portion thereof,
at any time on or prior to the second anniversary of the Issue Date or (y)
the proposed transferee has delivered to the Registrar a certificate
substantially in the form of
35
Exhibit C hereto and any legal opinions and certifications as may be
reasonably requested by the Trustee and the Issuer;
(ii) if the proposed transferee is a Participant and the Notes to be
transferred consist of Physical Notes which after transfer are to be
evidenced by an interest in the IAI Global Note, upon receipt by the
Registrar of the Physical Note and (x) written instructions given in
accordance with the Depository's and the Registrar's procedures and (y)
the certificate, if required, referred to in clause (y) of paragraph (i)
above (and any legal opinion or other certifications), the Registrar shall
register the transfer and reflect on its books and records the date and an
increase in the principal amount of the IAI Global Note in an amount equal
to the principal amount of Physical Notes to be transferred, and the
Registrar shall cancel the Physical Notes so transferred; and
(iii) if the proposed transferor is a Participant seeking to
transfer an interest in a Global Note, upon receipt by the Registrar of
(x) written instructions given in accordance with the Depository's and the
Registrar's procedures and (y) the certificate, if required, referred to
in clause (y) of paragraph (i) above, the Registrar shall register the
transfer and reflect on its books and records the date and (A) a decrease
in the principal amount of the Global Note from which such interests are
to be transferred in an amount equal to the principal amount of the Notes
to be transferred and (B) an increase in the principal amount of the IAI
Global Note in an amount equal to the principal amount of the Notes to be
transferred.
(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Restricted Security to
a QIB:
(i) the Registrar shall register the transfer of any Restricted
Security, whether or not such Note bears the Private Placement Legend, if
(x) the requested transfer is after the second anniversary of the Issue
Date; provided, however, that neither the Issuer nor any Affiliate of the
Issuer has held any beneficial interest in such Note, or portion thereof,
at any time on or prior to the second anniversary of the Issue Date or (y)
such transfer is being made by a proposed transferor who has checked the
box provided for on the applicable Global Note stating, or has otherwise
advised the Issuer and the Registrar in writing, that the sale has been
made in compliance with the provisions of Rule 144A to a transferee who
has signed the certification provided for on the applicable Global Note
stating, or has otherwise advised the Issuer and the Registrar in writing,
that it is purchasing the Note for its own account or an account with
respect to which it exercises sole investment discretion and that it and
any such account is a QIB within the meaning of Rule 144A, and is aware
that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Issuer as
it has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon
its foregoing representations in order to claim the exemption from
registration provided by Rule 144A;
(ii) if the proposed transferee is a Participant and the Notes to be
transferred consist of Physical Notes which after transfer are to be
evidenced by an interest in the 144A Global Note, upon receipt by the
Registrar of the Physical Note and written
36
instructions given in accordance with the Depository's and the Registrar's
procedures, the Registrar shall register the transfer and reflect on its
book and records the date and an increase in the principal amount of the
144A Global Note in an amount equal to the principal amount of Physical
Notes to be transferred, and the Registrar shall cancel the Physical Notes
so transferred; and
(iii) if the proposed transferor is a Participant seeking to
transfer an interest in the IAI Global Note or the Regulation S Global
Note, upon receipt by the Registrar of written instructions given in
accordance with the Depository's and the Registrar's procedures, the
Registrar shall register the transfer and reflect on its books and records
the date and (A) a decrease in the principal amount of the IAI Global Note
or the Regulation S Global Note, as the case may be, in an amount equal to
the principal amount of the Notes to be transferred and (B) an increase in
the principal amount of the 144A Global Note in an amount equal to the
principal amount of the Notes to be transferred.
(c) Transfers of Interests in the Temporary Regulation S Global
Note. The following provisions shall apply with respect to the registration of
any proposed transfer of interests in the Temporary Regulation S Global Note:
(i) the Registrar shall register the transfer of an interest in the
Temporary Regulation S Global Note, whether or not such Global Note bears
the Private Placement Legend if the proposed transferor has delivered to
the Registrar a certificate substantially in the form of Exhibit E
stating, among other things, that the proposed transferee is a Non-U.S.
Person (except for a transfer to an Initial Purchaser);
(ii) if the proposed transferee is a Participant, upon receipt by
the Registrar of the documents referred to in clause (i)(x) above, if
required, and instructions given in accordance with the Depository's and
the Registrar's procedures, the Registrar shall reflect on its books and
records the date and amount of such transfer of an interest in the
Temporary Regulation S Global Note.
(d) Transfers to Non-U.S. Persons. The following provisions shall
apply with respect to any transfer of a Restricted Security to a Non-U.S. Person
under Regulation S:
(i) the Registrar shall register any proposed transfer of a
Restricted Security to a Non-U.S. Person upon receipt of a certificate
substantially in the form of Exhibit D from the proposed transferor and
such certifications, legal opinions and other information as the Trustee
or the Issuer may reasonably request; and
(ii) (a) if the proposed transferor is a Participant holding a
beneficial interest in the Rule 144A Global Note or the IAI Global Note or
the Note to be transferred consists of Physical Notes, upon receipt by the
Registrar of (x) the documents required by paragraph (i) and (y)
instructions in accordance with the Depository's and the Registrar's
procedures, the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the Rule 144A Global Note or the
IAI Global Note, as the case may be, in an amount equal to the principal
amount of the beneficial interest in the Rule 144A Global Note or the IAI
Global Note, as the case may be, to be transferred or
37
cancel the Physical Notes to be transferred, and (b) if the proposed
transferee is a Participant, upon receipt by the Registrar of instructions
given in accordance with the Depository's and the Registrar's procedures,
the Registrar shall reflect on its books and records the date and an
increase in the principal amount of the Permanent Regulation S Global Note
in an amount equal to the principal amount of the Rule 144A Global Note,
the IAI Global Note or the Physical Notes, as the case may be, to be
transferred.
(e) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Issuer shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02, the
Trustee shall authenticate one or more Global Notes and/or Physical Notes not
bearing the Private Placement Legend in an aggregate principal amount equal to
the principal amount of the beneficial interests in the Initial Global Notes or
Physical Notes, as the case may be, tendered for acceptance in accordance with
the Exchange Offer and accepted for exchange in the Exchange Offer; provided
that, an Exchange Security issued to a person resident in a province or
territory of Canada shall be subject to the provisions of Exhibit B applicable
to such person.
(f) Restrictions on Transfer and Exchange of Global Notes.
Notwithstanding any other provisions of this Indenture, a Global Note may not be
transferred as a whole except by the Depository to a nominee of the Depository
or by a nominee of the Depository to the Depository or another nominee of the
Depository or by the Depository or any such nominee to a successor Depository or
a nominee of such successor Depository.
(g) Private Placement Legend. Upon the transfer, exchange or
replacement of Notes not bearing the Private Placement Legend unless otherwise
required by applicable law, the Registrar shall deliver Notes that do not bear
the Private Placement Legend. Upon the transfer, exchange or replacement of
Notes bearing the Private Placement Legend, the Registrar shall deliver only
Notes that bear the Private Placement Legend unless (i) there is delivered to
the Trustee an Opinion of Counsel reasonably satisfactory to the Issuer and the
Trustee to the effect that neither such legend nor the related restrictions on
transfer are required in order to maintain compliance with the provisions of the
Securities Act or (ii) such Note has been offered and sold (including pursuant
to the Exchange Offer) pursuant to an effective registration statement under the
Securities Act.
(h) General. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it shall transfer such Note only as provided in this
Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.15 or Section 2.16. The
Issuer shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable written notice to the Registrar.
The Trustee shall have no obligation or duty to monitor, determine
or inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Note (including any transfers between or
38
among Depository Participants or beneficial owners of interests in any Global
Note) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if and when
expressly required by the terms of, this Indenture, and to examine the same to
determine substantial compliance as to form with the express requirements
hereof.
The Trustee shall have no responsibility for the actions or
omissions of the Depository, or the accuracy of the books and records of the
Depository.
(i) Cancellation and/or Adjustment of Global Note. At such time as
all beneficial interests in a particular Global Note have been exchanged for
Physical Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11 hereof. At
any time prior to such cancellation, if any beneficial interest in a Global Note
is exchanged for or transferred to a Person who shall take delivery thereof in
the form of a beneficial interest in another Global Note or for Physical Notes,
the principal amount of Notes represented by such Global Note shall be reduced
accordingly and an endorsement shall be made on such Global Note by the Trustee
or by the Depositary at the direction of the Trustee to reflect such reduction;
and if the beneficial interest is being exchanged for or transferred to a Person
who shall take delivery thereof in the form of a beneficial interest in another
Global Note, such other Global Note shall be increased accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Issuer elects to redeem Notes pursuant to Section 5, Section
6 or Section 10 of the Notes, it shall notify the Trustee in writing of the
Redemption Date, the Redemption Price and the principal amount of Notes to be
redeemed. The Issuer shall give notice of redemption to the Trustee at least 30
days but not more than 60 days before the Redemption Date (unless a shorter
notice shall be agreed to by the Trustee), together with such documentation and
records as shall enable the Trustee to select the Notes to be redeemed.
SECTION 3.02. Selection of Notes To Be Redeemed.
If less than all of the Notes are to be redeemed at any time, the
Trustee shall select Notes for redemption as follows:
(x) if the Notes are listed on any national securities exchange,
in compliance with the requirements of the principal national
securities exchange on which the Notes are listed; or
(a) if the Notes are not so listed, on a pro rata basis, by lot or
by such method as the Trustee shall deem fair and appropriate;
39
provided that, in the case of a partial redemption pursuant to Section 6 of the
Notes, the Trustee shall select the Notes or portions thereof on a pro rata
basis or on as nearly a pro rata basis as practicable (subject to the procedures
of the Depository) unless that method is otherwise prohibited.
No Notes of US$1,000 or less shall be redeemed in part. The Trustee
will promptly notify the Issuer in writing of the Notes selected for redemption
and, in the case of any Note selected for partial redemption, the principal
amount thereof to be redeemed or purchased.
SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption Date,
the Issuer shall mail or cause to be mailed a notice of redemption by first
class mail, postage prepaid, to each Holder whose Notes are to be redeemed at
its registered address (except that a notice issued in connection with a
redemption referred to in Article VIII may be more than 60 days before such
Redemption Date). At the Issuer's request, the Trustee shall forward the notice
of redemption in the Issuer's name and at the Issuer's expense. Each notice for
redemption shall identify the Notes (including the CUSIP or ISIN number) to be
redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued interest, if any,
to be paid;
(3) the name and address of the Paying Agent;
(4) that Notes called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price plus accrued interest, if
any;
(5) that, unless the Issuer defaults in making the redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the Redemption Date, and the only remaining right of the Holders of
such Notes is to receive payment of the Redemption Price upon surrender to
the Paying Agent of the Notes redeemed;
(6) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the
Redemption Date, and upon surrender and cancellation of such Note, a new
Note or Notes in aggregate principal amount equal to the unredeemed
portion thereof shall be issued;
(7) if fewer than all the Notes are to be redeemed, the
identification of the particular Notes (or portion thereof) to be
redeemed, as well as the aggregate principal amount of Notes to be
redeemed and the aggregate principal amount of Notes to be outstanding
after such partial redemption; and
(8) the Section of the Notes or this Indenture, as applicable,
pursuant to which the Notes are to be redeemed.
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The notice, if mailed in a manner herein provided, shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Note designated for redemption in whole or in
part shall not affect the validity of the proceedings for the redemption of any
other Note. Notices of redemption may not be conditional.
SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03,
Notes called for redemption become due and payable on the Redemption Date and at
the Redemption Price plus accrued interest, if any. Upon surrender to the
Trustee or Paying Agent, such Notes called for redemption shall be paid at the
Redemption Price (which shall include accrued interest thereon to, but not
including, the Redemption Date), but installments of interest, the maturity of
which is on or prior to the Redemption Date, shall be payable to Holders of
record at the close of business on the relevant Record Dates. On and after the
Redemption Date interest shall cease to accrue on Notes or portions thereof
called for redemption unless the Issuer shall have not complied with its
obligations pursuant to Section 3.05.
SECTION 3.05. Deposit of Redemption Price.
On or before 1:00 p.m. New York time on the Redemption Date, the
Issuer shall deposit with the Paying Agent U.S. Legal Tender sufficient to pay
the Redemption Price plus accrued and unpaid interest, if any, of all Notes to
be redeemed on that date.
If the Issuer complies with the preceding paragraph, then, unless
the Issuer defaults in the payment of such Redemption Price plus accrued
interest, if any, interest on the Notes to be redeemed shall cease to accrue on
and after the applicable Redemption Date, whether or not such Notes are
presented for payment.
SECTION 3.06. Notes Redeemed in Part.
If any Note is to be redeemed in part only, the notice of redemption
that relates to such Note shall state the portion of the principal amount
thereof to be redeemed. A new Note or Notes in principal amount equal to the
unredeemed portion of the original Note or Notes shall be issued in the name of
the Holder thereof upon surrender and cancellation of the original Note or
Notes.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Notes.
The Issuer shall pay the principal of (and premium, if any) and
interest on the Notes in the manner provided in the Notes, the Registration
Rights Agreement and this Indenture. An installment of principal of, or interest
on, the Notes shall be considered paid on the date it is due if the Trustee or
Paying Agent (other than the Issuer or a Subsidiary of Holdings) holds on that
date U.S. Legal Tender designated for and sufficient to pay the
41
installment. Interest on the Notes shall be computed on the basis of a 360-day
year comprised of twelve 30-day months. For the purposes of disclosure under the
Interest Act (Canada), the yearly rate of interest which is equivalent to the
rate payable under the Notes is the rate payable multiplied by the actual number
of days in the year and divided by 360.
The Issuer shall pay interest on overdue principal (including,
without limitation, post petition interest in a proceeding under any Bankruptcy
Law), and overdue interest, to the extent lawful, at the same rate per annum
borne by the Notes.
SECTION 4.02. Maintenance of Office or Agency.
The Issuer shall maintain in the Borough of Manhattan, The City of
New York, the office or agency required under Section 2.03 (which may be an
office of the Trustee or an affiliate of the Trustee or Registrar). The Issuer
shall give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. If at any time the Issuer shall fail
to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the address of the Trustee set forth in Section
12.02.
The Issuer may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations. The
Issuer shall give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.
The Issuers hereby designate the Corporate Trust Office of the
Trustee as one such office or agency of the Issuers in accordance with Section
2.03 of this Indenture.
SECTION 4.03. Corporate Existence.
Except as otherwise permitted by Section 4.13 or Article Five,
Holdings shall do or cause to be done all things reasonably necessary to
preserve and keep in full force and effect its corporate existence and the
corporate, partnership or other existence of each Restricted Subsidiary in
accordance with the respective organizational documents of each such Restricted
Subsidiary and the material rights (charter and statutory) and material
franchises of the Issuer and each Restricted Subsidiary; provided, however, that
Holdings shall not be required to preserve any such right, franchise or
corporate existence with respect to itself or any Restricted Subsidiary, if the
loss thereof would not, individually or in the aggregate, have a material
adverse effect on the Issuer and the Guarantors, taken as a whole.
SECTION 4.04. Payment of Taxes.
The Issuer and the Guarantors shall, and shall cause each of the
Restricted Subsidiaries to, pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, all material taxes, assessments and
governmental charges levied or imposed upon it or any of the Restricted
Subsidiaries or upon the income, profits or property of it or any of the
Restricted Subsidiaries; provided, however, that the Issuer and the Guarantors
shall not be required to pay or discharge or cause to be paid or discharged any
such tax, assessment, charge
42
or claim whose amount the applicability or validity is being contested in good
faith by appropriate actions and for which appropriate provision has been made,
or any such tax, assessment, charge or claim that would not reasonably be
expected to have a material adverse effect on the Issuer and the Guarantors
taken as a whole.
SECTION 4.05. Reserved.
SECTION 4.06. Compliance Certificate; Notice of Default.
(a) The Issuer shall deliver to the Trustee, within 120 days after
the close of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Issuer and the Guarantors has been made
under the supervision of the signing Officers with a view to determining
whether the Issuer and the Guarantors have kept, observed, performed and
fulfilled their obligations under this Indenture and further stating, as
to each such Officer signing such certificate, that to the best of such
Officer's knowledge, the Issuer and the Guarantors during such preceding
fiscal year has kept, observed, performed and fulfilled each and every
such covenant and no Default or Event of Default occurred during such year
and at the date of such certificate there is no Default or Event of
Default that has occurred and is continuing or, if such signers do know of
such Default or Event of Default, the certificate shall specify such
Default or Event of Default and what action, if any, the Issuer is taking
or proposes to take with respect thereto. The Officers' Certificate shall
also notify the Trustee should the Issuer elect to change the manner in
which it fixes the fiscal year end.
(b) The Issuer shall deliver to the Trustee promptly and in any
event within seven days after any Officer of the Issuer becomes aware of
the occurrence of any Default an Officers' Certificate specifying the
Default or Event of Default and what action, if any, the Issuer is taking
or proposes to take with respect thereto.
SECTION 4.07. Payments for Consent.
Holdings shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, pay or cause to be paid any consideration to or for
the benefit of any Holder for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Notes
unless such consideration is offered to be paid or is paid to all Holders that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
SECTION 4.08. Waiver of Stay, Extension or Usury Laws.
The Issuer and each Guarantor covenants (to the extent permitted by
applicable law) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law, wherever enacted, now or at any time hereafter
in force, or which may affect the covenants or the performance of this
Indenture, and (to the extent permitted by applicable law) each hereby expressly
waives all benefit or advantage of any such law, and covenants that it shall not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but shall suffer and permit the execution of every such power as though
no such law had been enacted.
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SECTION 4.09. Change of Control.
If a Change of Control occurs, the Issuer shall be required to make
an offer to purchase all Notes as described below (the "CHANGE OF CONTROL
OFFER"). In the Change of Control Offer, the Issuer shall offer a payment in
cash ("CHANGE OF CONTROL PAYMENT") equal to 101% of the aggregate principal
amount of Notes repurchased plus accrued and unpaid interest and Special
Interest, if any, on the Notes purchased, to the date of purchase, subject to
the rights of Holders on the relevant Record Date to receive interest due on the
relevant Interest Payment Date. Within thirty days following any Change of
Control, the Issuer shall mail or cause to be mailed a notice to each Holder
describing the transaction or transactions that constitute the Change of Control
and offering to repurchase Notes on the Change of Control Payment Date specified
in the notice, which date shall be a Business Day no earlier than 30 days and no
later than 60 days from the date such notice is mailed, pursuant to the
procedures described below. Such notice shall state:
(1) that the Change of Control Offer is being made pursuant to this
Section 4.09 and that all Notes tendered and not withdrawn shall be
accepted for payment;
(2) the purchase price (including the amount of accrued interest)
and the Change of Control Payment Date;
(3) that any Note not tendered shall continue to accrue interest;
(4) that, unless the Issuer defaults in making payment therefor, any
Note accepted for payment pursuant to the Change of Control Offer shall
cease to accrue interest after the Change of Control Payment Date;
(5) that Holders electing to have a Note purchased pursuant to a
Change of Control Offer shall be required to surrender the Note, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Note completed, to the Paying Agent at the address specified in the notice
prior to the close of business on the third Business Day prior to the
Change of Control Payment Date;
(6) that Holders shall be entitled to withdraw their election if the
Paying Agent receives, not later than the second Business Day prior to the
Change of Control Payment Date, a telegram, facsimile transmission or
letter setting forth the name of the Holder, the principal amount of the
Notes the Holder delivered for purchase and a statement that such Holder
is withdrawing his election to have such Note purchased; and
(7) that Holders whose Notes are purchased only in part shall be
issued new Notes in a principal amount equal to the unpurchased portion of
the Notes surrendered (equal to $1,000 or an integral multiple thereof).
On the Change of Control Payment Date, the Issuer shall, to the
extent lawful:
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(1) accept for payment all Notes or portions of Notes in minimum
amounts equal to US$1,000 or an integral multiple of US$1,000 in excess
thereof, properly tendered pursuant to the Change of Control Offer;
(2) deposit with the Paying Agent an amount equal to the Change of
Control Payment in respect of all Notes or portions of Notes properly
tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes
properly accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions of Notes being purchased
by the Issuer.
The Paying Agent shall promptly mail to each Holder properly
tendered the Change of Control Payment for such Notes, and the Trustee shall
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; provided that each new Note shall be in a
principal amount of US$1,000 or an integral multiple of US$1,000.
The Issuer shall publicly announce the results of the Change of
Control Offer on or as soon as practicable after the Change of Control Payment
Date.
The Issuer shall not be required to make a Change of Control Offer
upon a Change of Control if (1) a third party makes the Change of Control Offer
in the manner, at the times and otherwise in compliance with the requirements
set forth in this Indenture applicable to a Change of Control Offer made by the
Issuer and purchases all Notes properly tendered and not withdrawn under such
Change of Control Offer or (2) a notice of redemption has been given pursuant to
Section 5 of the Notes, unless and until there is a default in payment of the
applicable Redemption Price.
The Issuer shall comply, and shall cause any third party making a
Change of Control Offer to comply, with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with a repurchase
of the Notes as a result of a Change of Control. To the extent the provisions of
any applicable securities laws or regulations conflict with the provisions of
this Section 4.09, the Issuer shall not be deemed to have breached its
obligations under this Section 4.09 by virtue of such compliance.
Notwithstanding the foregoing, the Issuer shall not be required to
make a Change of Control Offer, as provided above, if, in connection with or in
contemplation of any Change of Control, it or a third party has made an offer to
purchase (an "ALTERNATE OFFER") any and all Notes validly tendered at a cash
price equal to or higher than the Change of Control Payment and has purchased
all Notes properly tendered in accordance with the terms of such Alternate
Offer.
SECTION 4.10. Incurrence of Indebtedness and Issuance of Preferred Stock.
(a) Holdings shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "INCUR") any Indebtedness (including Acquired
Debt), and Holdings shall not issue any Disqualified Stock and
45
shall not permit any Restricted Subsidiary to issue any shares of preferred
stock; provided, however, that Holdings may incur Indebtedness (including
Acquired Debt) or issue Disqualified Stock, and any Subsidiary Guarantor may
incur Indebtedness (including Acquired Debt) or issue preferred stock, if the
Fixed Charge Coverage Ratio of Holdings for its most recently ended four full
fiscal quarters for which internal financial statements are available
immediately preceding the date on which such additional Indebtedness is incurred
or such Disqualified Stock or preferred stock is issued, as the case may be,
would have been at least 2.0 to 1.0, determined on a pro forma basis (including
a pro forma application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred or the Disqualified Stock or the preferred stock
had been issued, as the case may be, at the beginning of such four-quarter
period.
(b) Notwithstanding Section 4.10(a), the incurrence of any of the
following items of Indebtedness shall be permitted (collectively, "PERMITTED
DEBT"):
(1) the incurrence by the Issuer and any Guarantor of Indebtedness
and letters of credit under Credit Facilities in an aggregate amount at
any time outstanding under this clause (1) (with letters of credit being
deemed to have an amount equal to the maximum potential liability of
Holdings and the Restricted Subsidiaries thereunder) not to exceed the
greater of (a) the sum of (x) US$165.0 million and (y) Can$180.0 million
(including the Canadian Dollar Equivalent of any amount under this clause
(y) denominated in U.S. dollars) less the aggregate amount of all Net
Proceeds of Asset Sales applied by Holdings or any Restricted Subsidiary
since the date of this Indenture to repay any term Indebtedness under a
Credit Facility or to repay any revolving credit Indebtedness under a
Credit Facility and effect a corresponding commitment reduction thereunder
pursuant to Section 4.13 and (b) the amount that is 2.5 times Consolidated
Cash Flow of Holdings for its most recently ended four full fiscal
quarters for which internal financial statements are available;
(2) the incurrence by Holdings and the Restricted Subsidiaries of
the Existing Indebtedness;
(3) the incurrence of the Notes on the Issue Date, the Guarantees
and the Exchange Securities to be issued pursuant to the Registration
Rights Agreement;
(4) the incurrence by Holdings or any Restricted Subsidiary of
Indebtedness represented by Capital Lease Obligations, mortgage financings
or purchase money obligations, in each case, incurred for the purpose of
financing all or any part of the purchase price or cost of design,
construction, installation or improvement of property, plant or equipment
used or useful in the business of Holdings or any Restricted Subsidiary,
and refinancings thereof, in an aggregate amount not to exceed US$10.0
million at any time outstanding;
(5) the incurrence by Holdings or any Restricted Subsidiary of
Permitted Refinancing Indebtedness in exchange for, or the net proceeds of
which are used to refund, refinance, replace, defease or discharge,
Indebtedness (other than intercompany Indebtedness) permitted to be
incurred under Sections 4.10(a), (b)(2), (b)(3) or (b)(5);
46
(6) the incurrence by Holdings or any Restricted Subsidiary of
intercompany Indebtedness between or among Holdings and/or any Restricted
Subsidiary; provided, however, that:
(a) if the Issuer or any Guarantor is the obligor on such
Indebtedness and the payee is not the Issuer or a Guarantor, such
Indebtedness must be expressly subordinated to the prior payment in
full in cash of all Obligations then due with respect to the Notes,
in the case of the Issuer, or the Guarantee, in the case of a
Guarantor; and
(b) (i) any subsequent issuance or transfer of Equity
Interests that results in any such Indebtedness being held by a
Person other than Holdings or a Restricted Subsidiary and (ii) any
sale or other transfer of any such Indebtedness to a Person that is
neither Holdings nor a Restricted Subsidiary shall be deemed, in
each case, to constitute an incurrence of such Indebtedness by
Holdings or such Restricted Subsidiary, as the case may be, that is
not permitted by this clause (6);
(7) the issuance by any of the Restricted Subsidiaries to Holdings
or to any Restricted Subsidiary of preferred stock; provided, however,
that (a) any subsequent issuance or transfer of Equity Interests that
results in any such preferred stock being held by a Person other than
Holdings or a Restricted Subsidiary and (b) any sale or other transfer of
any such preferred stock to a Person that is neither Holdings nor a
Restricted Subsidiary shall be deemed, in each case, to constitute an
issuance of such preferred stock by such Restricted Subsidiary that is not
permitted by this clause (7);
(8) the incurrence by Holdings or any Restricted Subsidiary of
Hedging Obligations in the ordinary course of business;
(9) the guarantee by the Issuer or any Guarantor of Indebtedness of
Holdings or a Restricted Subsidiary that was permitted to be incurred by
another provision of this Section 4.10; provided that if the Indebtedness
being guaranteed is subordinated to the Notes or the Guarantees, then the
guarantee shall be subordinated to the same extent as the Indebtedness
guaranteed;
(10) the incurrence by Holdings or any Restricted Subsidiary of
Indebtedness in respect of workers' compensation claims, self-insurance
obligations, indemnities, bankers' acceptances, performance, completion
and surety bonds or guarantees, and similar types of obligations in the
ordinary course of business;
(11) the incurrence by Holdings or any Restricted Subsidiary of
Indebtedness arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument inadvertently drawn
against insufficient funds, so long as such Indebtedness is covered within
five business days;
(12) the incurrence by Holdings or any Restricted Subsidiary of
Indebtedness consisting of guarantees, earn-outs, indemnities or
obligations in respect of purchase price adjustments in connection with
the acquisition or disposition of assets, including, without limitation,
shares of Capital Stock; provided that the maximum aggregate
47
liability in respect of all such obligations outstanding under this clause
(12) shall at no time exceed (a) in the case of an acquisition, US$10.0
million (provided that the amount of such liability shall be deemed to be
the amount thereof, if any, reflected on the consolidated balance sheet of
Holdings (e.g., the amount of such liability shall be deemed to be zero if
no amount is reflected on such balance sheet)) and (b) in the case of a
disposition, the gross proceeds actually received by Holdings and the
Restricted Subsidiaries in connection with such disposition;
(13) Daylight Loans incurred by Holdings from time to time;
(14) Indebtedness in respect of Permitted Factoring Arrangements;
and
(15) the incurrence by Holdings or any Restricted Subsidiary of
additional Indebtedness in an aggregate amount at any time outstanding,
including all Indebtedness incurred to refund, refinance, replace, defease
or discharge any Indebtedness incurred pursuant to this clause (15), not
to exceed US$25.0 million.
(c) For purposes of determining compliance with this Section 4.10,
in the event that an item of proposed Indebtedness meets the criteria of more
than one of the categories of Permitted Debt described in clauses (1) through
(15) of Section 4.10(b), or is entitled to be incurred pursuant to Section
4.10(a), the Issuer is permitted to classify such item of Indebtedness on the
date of its incurrence, or later reclassify all or a portion of such item of
Indebtedness, in any manner that complies with this Section 4.10. Indebtedness
under Credit Facilities outstanding on the Issue Date shall initially be deemed
to have been incurred on such date in reliance on the exception provided by
clause (1) of Section 4.10(b).
(d) The accrual of interest, the accrual of dividends, the accretion
or amortization of original issue discount, the payment of interest on any
Indebtedness in the form of additional Indebtedness with the same terms, and the
payment of dividends on Disqualified Stock in the form of additional shares of
the same class of Disqualified Stock shall not be deemed to be an incurrence of
Indebtedness or an issuance of Disqualified Stock for purposes of this Section
4.10; provided, in each such case, that the amount thereof is included in Fixed
Charges of Holdings as accrued. Notwithstanding any other provision of this
Section 4.10, the maximum amount of Indebtedness that Holdings or any Restricted
Subsidiary may incur pursuant to this Section 4.10 shall not be deemed to be
exceeded solely as a result of fluctuations in exchange rates or currency
values.
(e) The amount of any Indebtedness outstanding as of any date shall
be:
(1) the accreted value of the Indebtedness, in the case of any
Indebtedness issued with original issue discount;
(2) the principal amount of the Indebtedness, in the case of any
other Indebtedness; and
(3) in respect of Indebtedness of another Person secured by a Lien
on the assets of the specified Person, the lesser of:
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(A) the Fair Market Value of such assets at the date of
determination; and
(B) the amount of the Indebtedness of the other Person that is
secured by such assets.
SECTION 4.11. Limitations on Restricted Payments.
(a) Holdings shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly:
(i) declare or pay any dividend or make any other payment or
distribution on account of the Equity Interests of Holdings or any
Restricted Subsidiary (including, without limitation, any payment in
connection with any merger, amalgamation or consolidation involving
Holdings or any Restricted Subsidiary) or to the direct or indirect
holders of the Equity Interests of Holdings or any Restricted Subsidiary
in their capacity as such (other than (A) dividends or distributions
payable in Qualified Equity Interests, (B) dividends or distributions
payable to Holdings or any Restricted Subsidiary and (C) any dividend,
payment or distribution made on the Issue Date in connection with the
amalgamation as described in the Offering Circular under the caption "Use
of Proceeds";
(ii) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger,
amalgamation or consolidation involving Holdings) any Equity Interests of
Holdings or any Parent Company;
(iii) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value, any Indebtedness of the
Issuer or any Guarantor that is contractually subordinated to the Notes or
any Guarantee (excluding any Indebtedness owed to and held by Holdings or
any Restricted Subsidiary), other than (x) payments of interest or
principal at the Stated Maturity thereof and (y) payments, purchases,
redemptions, defeasances or other acquisitions or retirements for value in
anticipation of satisfying a scheduled maturity, sinking fund or
amortization or other installment obligation or mandatory redemption, in
each case, due within one year of the Stated Maturity thereof; or
(iv) make any Restricted Investment
(all such payments and other actions set forth in clauses (i) through (iv) above
being collectively referred to as "RESTRICTED PAYMENTS"), unless, at the time of
and after giving effect to such Restricted Payment:
(1) no Default or Event of Default has occurred and is continuing or
would occur as a consequence of such Restricted Payment;
(2) Holdings would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been
made at the beginning of the applicable four-quarter period, have been
permitted to incur at least US$1.00 of
49
additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test
set forth in Section 4.10(a); and
(3) such Restricted Payment, together with the aggregate amount of
all other Restricted Payments made by Holdings and the Restricted
Subsidiaries since the date of this Indenture (excluding Restricted
Payments permitted by clauses (2), (3), (4), (5), (6), (7), (8), (9) and
(10) of the next succeeding paragraph), is not greater than the sum,
without duplication, of:
(a) 50% of the Consolidated Net Income of Holdings for the
period (taken as one accounting period) from the beginning of the
fiscal quarter in which the Issue Date occurs to the end of
Holdings' most recently ended fiscal quarter for which internal
financial statements are available at the time of such Restricted
Payment (or, if such Consolidated Net Income for such period is a
deficit, less 100% of such deficit); plus
(b) 100% of the aggregate net cash proceeds received by
Holdings, and 100% of the Fair Market Value at the time of receipt
of assets other than cash, if any, received by Holdings, after the
date of this Indenture as a contribution to its common equity
capital or from the issue or sale of Qualified Equity Interests or
from the issue or sale (other than to a Subsidiary of Holdings) of
convertible or exchangeable Disqualified Stock or convertible or
exchangeable debt securities of Holdings that have been converted
into or exchanged for Qualified Equity Interests; plus
(c) to the extent that any Restricted Investment that was made
after the date of this Indenture is sold for cash or Holdings or a
Restricted Subsidiary otherwise receives Cash Equivalents therefor,
the return of capital in cash or Cash Equivalents with respect to
such Restricted Investment (less the cost of disposition, if any);
plus
(d) to the extent that any Unrestricted Subsidiary is
redesignated as a Restricted Subsidiary after the date of this
Indenture, the Fair Market Value of the Investment of Holdings and
the Restricted Subsidiaries in such Subsidiary as of the date of
such redesignation.
The preceding provisions shall not prohibit:
(1) the payment of any dividend within 60 days after the date of
declaration of the dividend, if at the date of declaration the dividend
payment would have complied with the provisions of this Indenture;
(2) the making of any Restricted Payment in exchange for, or out of
the net cash proceeds of the substantially concurrent sale (other than to
a Subsidiary of Holdings) of, Qualified Equity Interests or from the
substantially concurrent contribution of common equity capital to
Holdings; provided that the amount of any such net cash proceeds that is
utilized for any such Restricted Payment shall be excluded from clause
(3)(b) of the preceding paragraph;
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(3) the payment, defeasance, redemption, repurchase or other
acquisition or retirement for value of Indebtedness of the Issuer or any
Guarantor that is contractually subordinated to the Notes or to any
Guarantee with the net cash proceeds from a substantially concurrent
incurrence of Permitted Refinancing Indebtedness;
(4) the payment of any dividend (or, in the case of any partnership,
limited liability company or unlimited company, any similar distribution)
by a Restricted Subsidiary of Holdings to the holders of its Equity
Interests on a pro rata basis taking into account the relative
preferences, if any, of the various classes of equity interests in such
Restricted Subsidiary;
(5) the repurchase, redemption or other acquisition or retirement
for value of any Equity Interests of Holdings or any Restricted
Subsidiary, or payments by Holdings to any Parent Company to permit, and
which are used by, any Parent Company to repurchase, redeem or otherwise
acquire or retire for value any Equity Interests of any Parent Company, in
each case, held by any current or former officer, director, consultant or
employee of Holdings or any Restricted Subsidiary (or permitted
transferees, assigns, estates or heirs of any of the foregoing); provided
that the aggregate price paid for all such repurchased, redeemed, acquired
or retired Equity Interests may not exceed US$5.0 million in any calendar
year (excluding for purposes of calculating such amount the purchase price
of Equity Interests repurchased, redeemed, acquired or retired with the
proceeds from the repayment of loans by Holdings or a Restricted
Subsidiary made for the purpose of purchasing such Equity Interests), with
unused amounts being available to be used in the following calendar year,
but not in any succeeding calendar year;
(6) the repurchase of Equity Interests deemed to occur upon the
exercise of stock options to the extent such Equity Interests represent a
portion of the exercise price of those stock options;
(7) the declaration and payment of dividends on Designated Preferred
Stock in accordance with the certificate of designations therefor;
provided that at the time of issuance of such Designated Preferred Stock,
Holdings would, after giving pro forma effect thereto as if such issuance
had been made at the beginning of the applicable four-quarter period, have
been permitted to incur at least US$1.00 of additional Indebtedness
pursuant to the Fixed Charge Coverage Ratio test set forth in Section
4.10(a);
(8) payments made to purchase, redeem, defease or otherwise acquire
or retire for value any Equity Interests of Holdings or any Restricted
Subsidiary or any Indebtedness of the Issuer or any Guarantor that is
contractually subordinated to the Notes or to any Guarantee, in each case,
pursuant to provisions requiring such Person to offer to purchase, redeem,
defease or otherwise acquire or retire for value such Equity Interests or
subordinated Indebtedness upon the occurrence of a "change of control" or
with the proceeds of "asset sales" as defined in the charter provisions,
agreements or instruments governing such Equity Interests or subordinated
Indebtedness; provided, however, that a Change of Control Offer or Asset
Sale Offer, as applicable, has been made and the Issuer has purchased all
Notes validly tendered in connection with that Change of Control Offer or
Asset Sale Offer;
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(9) payments pursuant to Sections 4.14(b)(4), (8) or (10); and
(10) other Restricted Payments in an aggregate amount not to exceed
US$20.0 million since the date of this Indenture;
provided that in the case of any Restricted Payment pursuant to clause
(5), (7), (8) or (10), no Default shall have occurred and be continuing.
The amount of all Restricted Payments (other than cash) shall be the
Fair Market Value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by Holdings or such Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment.
For purposes of determining compliance with this Section 4.11, if a
Restricted Payment meets the criteria of more than one of the exceptions
described in clauses (1) through (10) above or is entitled to be made according
to Section 4.11(a), Holdings may, in its sole discretion, classify the
Restricted Payment in any manner that complies with this Section 4.11.
SECTION 4.12. Limitations on Liens.
Holdings shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create, incur, assume or suffer to exist any Lien of
any kind on any asset now owned or hereafter acquired, except Permitted Liens,
which Lien secures Indebtedness or trade payables, unless contemporaneously
therewith:
(1) in the case of any Lien securing an obligation that ranks pari
passu with the Notes or a Guarantee, effective provision is made to secure
the Notes or such Guarantee, as the case may be, at least equally and
ratably with or prior to such obligation with a Lien on the same
collateral; and
(2) in the case of any Lien securing an obligation that is
subordinated in right of payment to the Notes or a Guarantee, effective
provision is made to secure the Notes or such Guarantee, as the case may
be, with a Lien on the same collateral that is prior to the Lien securing
such subordinated obligation,
in each case, for so long as such obligation is secured by such Lien.
SECTION 4.13. Limitations on Asset Sales.
(a) Holdings shall not, and shall not permit any Restricted
Subsidiary to, consummate an Asset Sale unless:
(1) Holdings (or a Restricted Subsidiary) receives consideration at
the time of the Asset Sale at least equal to the Fair Market Value of the
assets or Equity Interests issued or sold or otherwise disposed of; and
(2) at least 75% of the consideration received in the Asset Sale by
Holdings or such Restricted Subsidiary is in the form of cash or Cash
Equivalents.
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(b) For purposes of this provision, each of the following shall be
deemed to be cash:
(1) any liabilities, as shown on Holdings' most recent consolidated
balance sheet, of Holdings or any Restricted Subsidiary (other than
liabilities that are by their terms subordinated to the Notes or any
Guarantee) that are assumed by the transferee of any such assets pursuant
to a customary novation agreement that releases Holdings or such
Restricted Subsidiary from such liabilities;
(2) any securities, notes or other obligations received by Holdings
or any such Restricted Subsidiary from such transferee that are, within
180 days of the Asset Sale, converted by Holdings or such Restricted
Subsidiary into cash or Cash Equivalents, to the extent of the cash or
Cash Equivalents received in that conversion; and
(3) any stock or assets of the kind referred to in clause (2) or (4)
of Section 4.13(c).
(c) Within 365 days after the receipt of any Net Proceeds from an
Asset Sale, Holdings (or a Restricted Subsidiary) may apply those Net Proceeds
at its option:
(1) to repay any Senior Debt and, if the Indebtedness repaid is
revolving credit Indebtedness, to correspondingly reduce commitments with
respect thereto;
(2) to acquire all or substantially all of the assets of, or any
Capital Stock of, a Person engaged in a Permitted Business; provided that
in the case of acquisition of Capital Stock of any Person, such
acquisition is permitted by Section 4.11 (without giving effect to clause
(4) of the definition of "Permitted Investments");
(3) to make a capital expenditure; or
(4) to acquire other assets that are not classified as current
assets under GAAP and that are used or useful in a Permitted Business.
Pending the final application of any Net Proceeds, Holdings (or a
Restricted Subsidiary) may temporarily reduce revolving credit borrowings or
otherwise invest the Net Proceeds in any manner that is not prohibited by this
Indenture.
(d) Any Net Proceeds from Asset Sales that are not applied or
invested as provided in Section 4.13(b) shall constitute "EXCESS PROCEEDS." When
the aggregate amount of Excess Proceeds exceeds US$15.0 million, the Issuer
shall make an offer to purchase (an "ASSET SALE OFFER"), to all Holders and all
holders of other Indebtedness that is pari passu with the Notes containing
provisions similar to those set forth in this Indenture with respect to offers
to purchase or redeem with the proceeds of sales of assets, the maximum
principal amount of Notes and such other pari passu Indebtedness that may be
purchased out of the Excess Proceeds (the "Payment Amount"). The offer price for
the Notes in any Asset Sale Offer shall be equal to 100% of principal amount of
the Notes plus accrued and unpaid interest and Special Interest thereon, if any,
to the date of purchase (the "Offered Price"), and shall be payable in cash, and
the offer or redemption price for such pari passu Indebtedness shall be as set
forth in the related
53
documentation governing such Indebtedness. If any Excess Proceeds remain after
consummation of an Asset Sale Offer, the Issuer may use those Excess Proceeds
for any purpose not otherwise prohibited by this Indenture. If the aggregate
principal amount of Notes and other pari passu Indebtedness tendered into such
Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall select
the Notes and such other pari passu Indebtedness to be purchased on a pro rata
basis. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds
shall be reset at zero.
(e) Upon the commencement of a Asset Sale Offer, the Issuer shall
send, by first class mail, a notice to the Trustee and to each Holder at is
registered address. The notice shall contain all instructions and materials
necessary to enable such Holder to tender Notes pursuant to the Asset Sale
Offer. Any Asset Sale Offer shall be made to all Holders. The notice, which
shall govern the terms of the Asset Sale Offer, shall state:
(1) that the Asset Sale Offer is being made pursuant to this
Section;
(2) the Payment Amount, the Offered Price, and the date on which
Notes tendered and accepted for payment shall be purchased, which date
shall be at least 30 days and not later than 60 days from the date such
notices is mailed (the "ASSET SALE PAYMENT DATE");
(3) that any Notes not tendered or accepted for payment shall
continue to accrue interest;
(4) that, unless the Issuer defaults in making such payment, any
Notes accepted for payment pursuant to the Asset Sale Offer shall cease to
accrue interest on and after the Asset Sale Payment Date;
(5) that Holders electing to have any Notes purchased pursuant to
any Asset Sale Offer shall be required to surrender the Notes, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Note completed, or transfer by book-entry transfer, to the Issuer, a
depository, if appointed by the Issuer, or the Paying Agent at the address
specified in the notice at least three days before the Asset Sale Payment
Date;
(6) that Holders shall be entitled to withdraw their election if the
Issuer, the Depository or the Paying Agent, as the case may be, receives,
not later than the Asset Sale Payment Date, a notice setting forth the
name of the Holder, the principal amount of the Note the Holder delivered
for purchase and a statement that such Holder is withdrawing his election
to have such Note purchased;
(7) that if the aggregate principal amount of Notes surrendered by
Holders exceeds the Payment Amount, the Issuer shall select the Notes to
be purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Issuer so that only Notes in denominations of US$1,000,
or integral multiples thereof, shall be purchased); and
54
(8) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered (or transferred by book-entry).
(f) On the Asset Sale Payment Date, the Issuer shall, to the extent
lawful: (1) accept for payment all Notes or portions thereof properly tendered
pursuant to the Asset Sale Offer, subject to pro ration if the aggregate Notes
tendered exceed the Payment Amount allocable to the Notes; (2) deposit with the
Paying Agent U.S. Legal Tender equal to the lesser of the Payment Amount
allocable to the Notes and the amount sufficient to pay the Offered Price in
respect of all Notes or portions thereof so tendered; and (3) deliver or cause
to be delivered to the Trustee the Notes so accepted together with an Officers'
Certificate stating the aggregate principal amount of Notes or portions thereof
being repurchased by the Issuer. The Issuer shall publicly announce the results
of the Asset Sale Offer on the Asset Sale Payment Date.
(g) The Paying Agent shall promptly mail to each Holder so tendered
the Offered Price for such Notes, and the Trustee shall promptly authenticate
pursuant to an Authentication Order and mail (or cause to be transferred by
book-entry) to each Holder a new Note equal in principal amount to any
unrepurchased portion of the Notes surrendered, if any; provided that each such
new Note shall be in principal amount of $1,000 or an integral multiple thereof.
However, if the Asset Sale Payment Date is on or after an interest record date
and on or before the related Interest Payment Date, any accrued and unpaid
interest shall be paid to the Person in whose name a Note is registered at the
close of business on such record date, and no additional interest shall be
payable to Holders who tender Notes pursuant to the Asset Sale Offer.
The Issuer shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the Asset Sale
provisions of this Section 4.13, the Issuer shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under this Section 4.13 by virtue of such compliance.
SECTION 4.14. Limitations on Transactions with Affiliates.
(a) Holdings shall not, and shall not permit any Restricted
Subsidiary to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate of Holdings (each, an "AFFILIATE TRANSACTION"), unless:
(1) the Affiliate Transaction is on terms that are not materially
less favorable to Holdings or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by
Holdings or such Restricted Subsidiary with an unrelated Person; and
(2) Holdings delivers to the Trustee:
55
(a) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of US$5.0 million, a resolution of the Board of Directors of
Holdings set forth in an Officers' Certificate certifying that such
Affiliate Transaction complies with this Section 4.14 and that such
Affiliate Transaction has been approved by a majority of the
disinterested members of such Board of Directors; and
(b) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of US$20.0 million, an opinion as to the fairness to Holdings
or such Restricted Subsidiary of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or
investment banking firm of national standing in the United States or
Canada.
(b) The following items shall not be deemed to be Affiliate
Transactions and, therefore, shall not be subject to the provisions of the prior
paragraph:
(1) reasonable director, officer, consultant and employee
compensation, benefit and indemnification agreements, plans and
arrangements entered into by Holdings or any Restricted Subsidiary in the
ordinary course of business and payments pursuant thereto;
(2) transactions between or among Holdings and/or the Restricted
Subsidiaries;
(3) transactions with a Person (other than an Unrestricted
Subsidiary of Holdings) that is an Affiliate of Holdings solely because
Holdings owns, directly or through a Restricted Subsidiary, an Equity
Interest in, or controls, such Person;
(4) to the extent that Holdings or one or more of the Restricted
Subsidiaries are members of a consolidated, combined or similar income tax
group of which a direct or indirect parent of Holdings is the common
parent, payment of dividends or other distributions by Holdings or one or
more of the Restricted Subsidiaries pursuant to a tax sharing agreement or
otherwise to the extent necessary to pay, and which are used to pay, any
income taxes of such tax group that are attributable to Holdings and/or
the Restricted Subsidiaries (or would be attributable to Holdings if
Holdings were a U.S. corporation) and are not payable directly by Holdings
and/or the Restricted Subsidiaries; provided that the amount of any such
dividends or distributions (plus any such taxes payable directly by
Holdings and/or the Restricted Subsidiaries) shall not exceed the amount
of such taxes that would have been payable directly by Holdings and/or the
Restricted Subsidiaries had Holdings been the U.S. common parent of a
separate tax group that included only Holdings and the Restricted
Subsidiaries;
(5) any issuance of Qualified Equity Interests (and the exercise of
any warrants, options or other rights to acquire Qualified Equity
Interests);
(6) Restricted Payments that do not violate Section 4.11;
56
(7) loans or advances to employees of Holdings or any Restricted
Subsidiary (x) in the ordinary course of business in an aggregate amount
not to exceed US$5.0 million at any time outstanding or (y) in connection
with the purchase by such Persons of Equity Interests of Holdings or any
Parent Company so long as the cash proceeds of such purchase received by
any Parent Company are contemporaneously contributed to the common equity
capital of Holdings;
(8) payments by Holdings to or on behalf of any Parent Company in an
amount sufficient to pay out-of-pocket legal, accounting and filing and
other general corporate overhead costs of such Parent Company and
franchise taxes and other fees required to maintain its existence actually
incurred by such Parent Company, in any case in an aggregate amount not to
exceed US$1.0 million in any calendar year;
(9) the agreements described in the Offering Circular under the
caption "Certain Relationships and Related Party Transactions," as in
effect on the date of this Indenture or as amended thereafter (so long as
the amended agreement is not more disadvantageous to the Holders, taken as
a whole, in any material respect than such agreement immediately prior to
such amendment) or any transaction contemplated thereby (other than
payment of management fees referred to in clause (10) below); and
(10) so long as no Event of Default exists, the existence or
performance by Holdings or any Restricted Subsidiary of the provisions of
the Management Agreement described in the Offering Circular under "Certain
Relationships and Related Party Transactions" or any amendment thereto or
replacement agreement therefor or any transaction contemplated thereby so
long as such amendment or replacement is not more disadvantageous to the
Holders, taken as a whole, in any material respect than the original
agreements as in effect on the date of this Indenture.
SECTION 4.15. Dividend and Other Payment Restrictions Affecting Subsidiaries.
Holdings shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to:
(1) pay dividends or make any other distributions on its Capital
Stock to Holdings or any Restricted Subsidiary, or with respect to any
other interest or participation in, or measured by, its profits, or pay
any Indebtedness owed to Holdings or any Restricted Subsidiary;
(2) make loans or advances to Holdings or any Restricted Subsidiary;
or
(3) transfer any of its properties or assets to Holdings or any
Restricted Subsidiary.
However, the preceding restrictions shall not apply to encumbrances
or restrictions existing under or by reason of:
57
(1) agreements governing Existing Indebtedness and Credit Facilities
as in effect on the date of this Indenture and any amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings of those agreements; provided that the
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings are no more restrictive, taken as
a whole, with respect to such dividend and other payment restrictions than
those contained in those agreements on the date of this Indenture;
(2) this Indenture, the Notes and the Guarantees;
(3) applicable law, rule, regulation or order;
(4) any instrument governing Indebtedness or Capital Stock of a
Person acquired by Holdings or any Restricted Subsidiary as in effect at
the time of such acquisition (except to the extent such Indebtedness or
Capital Stock was incurred in connection with or in contemplation of such
acquisition), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the Person,
or the property or assets of the Person, so acquired; provided that, in
the case of Indebtedness, such Indebtedness was permitted by the terms of
this Indenture to be incurred;
(5) customary non-assignment provisions in contracts and licenses
entered into in the ordinary course of business;
(6) purchase money obligations for property acquired in the ordinary
course of business and Capital Lease Obligations that impose restrictions
on the property purchased or leased of the nature described in clause (3)
of the preceding paragraph;
(7) any agreement for the sale or other disposition of a Restricted
Subsidiary or an asset that restricts distributions by that Restricted
Subsidiary or transfers of such asset pending the sale or other
disposition;
(8) Permitted Refinancing Indebtedness; provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are not materially more restrictive, taken as a
whole, than those contained in the agreements governing the Indebtedness
being refinanced;
(9) Liens permitted to be incurred under the provisions of Section
4.12 that limit the right of the debtor to dispose of the assets subject
to such Liens;
(10) provisions limiting the disposition or distribution of assets
or property in joint venture agreements, partnership agreements, limited
liability company operating agreements, asset sale agreements,
sale-leaseback agreements, stock sale agreements and other similar
agreements entered into with the approval of the Board of Directors of
Holdings, which limitation is applicable only to the assets that are the
subject of such agreements;
58
(11) restrictions on cash or other deposits or net worth imposed
under contracts entered into in the ordinary course of business;
(12) restrictions under Permitted Factoring Arrangements on the
disposition of accounts receivable subject to Permitted Factoring
Arrangements; and
(13) agreements governing Indebtedness permitted to be incurred
pursuant to Section 4.10; provided that the provisions relating to such
encumbrance or restriction contained in such Indebtedness, taken as a
whole, are not materially more restrictive to the Issuer or Holdings, as
applicable, as determined by the Board of Directors of the Issuer or
Holdings, as applicable, in its reasonable and good faith judgment, than
the provisions contained in the Credit Agreement or this Indenture as in
effect on the date of this Indenture.
SECTION 4.16. Subsidiary Guarantees.
(a) If any Restricted Subsidiary (including any newly formed or
newly acquired Restricted Subsidiary) guarantees any Indebtedness under any
Credit Facility, then within 30 days of the date on which it guaranteed such
Indebtedness, the Issuer shall:
(1) execute and deliver to the Trustee (a) a supplemental indenture
in form reasonably satisfactory to the Trustee pursuant to which such
Restricted Subsidiary shall unconditionally guarantee all of the Issuer's
obligations under the Notes and this Indenture and (b) a notation of
guarantee in respect of its Note Guarantee; and
(2) deliver to the Trustee an Opinion of Counsel that such
supplemental indenture has been duly authorized, executed and delivered by
such Restricted Subsidiary and constitutes a valid and legally binding and
enforceable obligation of such Restricted Subsidiary, subject to customary
exceptions.
Thereafter, such Restricted Subsidiary shall be a Subsidiary Guarantor for all
purposes of this Indenture.
(b) The Issuer shall not permit any Subsidiary Guarantor to,
directly or indirectly, consolidate, amalgamate or merge with or into another
Person (whether or not such Guarantor is the surviving Person) unless:
(1) such Guarantor is the surviving Person or the Person formed by
or surviving any such consolidation, amalgamation or merger (if other than
a Guarantor or the Issuer) expressly assumes all the obligations of such
Guarantor under the Guarantee of such Guarantor, this Indenture and the
Registration Rights Agreement pursuant to agreements reasonably
satisfactory to the Trustee; and
(2) immediately after such transaction, no Default or Event of
Default exists.
(c) Notwithstanding Section 4.16(b), the Guarantee of a Subsidiary
Guarantor shall automatically and unconditionally be released:
59
(1) in connection with any sale or other disposition of all or
substantially all of the assets of that Guarantor (including by way of
merger or consolidation) to a Person that is not (either before or after
giving effect to such transaction) Holdings or any Restricted Subsidiary,
if the sale or other disposition does not violate Section 4.13;
(2) in connection with any sale or other disposition of all of the
Capital Stock of that Guarantor to a Person that is not (either before or
after giving effect to such transaction) Holdings or any Restricted
Subsidiary, if the sale or other disposition does not violate Section
4.13;
(3) if Holdings designates such Subsidiary Guarantor to be an
Unrestricted Subsidiary in accordance with Section 4.19;
(4) upon legal defeasance or satisfaction and discharge of the Notes
as provided below under Sections 8.01 and 8.02; or
(5) if such Subsidiary Guarantor shall not guarantee any
Indebtedness under any Credit Facility (other than if such Subsidiary
Guarantor no longer guarantees any Indebtedness under any Credit Facility
as a result of payment under any guarantee of any such Indebtedness by any
Subsidiary Guarantor); provided that a Subsidiary Guarantor shall not be
permitted to be released from its Guarantee if it is an obligor with
respect to Indebtedness that would not, under Section 4.10, be permitted
to be incurred by a Restricted Subsidiary that is not a Guarantor.
SECTION 4.17. Limitations on Layering Indebtedness.
The Issuer shall not, directly or indirectly, incur any Indebtedness
that is, or purports to be by its terms (or by the terms of any agreement
governing such Indebtedness), subordinate or junior in right of payment to any
Senior Debt of the Issuer and senior in any respect in right of payment to the
Notes. No Guarantor shall, directly or indirectly, incur any Indebtedness that
is, or purports to be by its terms (or by the terms of any agreement governing
such Indebtedness), subordinate or junior in right of payment to any Senior Debt
of such Guarantor and senior in any respect in right of payment to such
Guarantor's Guarantee. For purposes hereof, unsecured Indebtedness shall not be
deemed to be subordinate or junior to secured Indebtedness solely because it is
unsecured, and Indebtedness that is not guaranteed by a particular Person shall
not be deemed to be subordinate or junior to Indebtedness solely because it is
not so guaranteed.
SECTION 4.18. Reports to Holders.
So long as any Notes are outstanding, the Issuer shall furnish to
the Holders or cause the Trustee to furnish to the Holders, within the time
periods that such information would have otherwise been required to have been
provided to the Commission if the rules and regulations applicable to the filing
of such information were applicable to the Issuer:
(1) all quarterly and annual information that would be required to
be filed with the Commission on (a) if the Issuer is a domestic issuer,
Forms 10-Q and 10-K if the Issuer were required to file such reports or
(b) if the Issuer is a foreign private issuer, on
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Form 6-K and Form 20-F or Form 40-F (if eligible) if the Issuer were
required to file such forms; and
(2) all current reports that would be required to be (a) filed if
the Issuer is a domestic issuer with the Commission on Form 8-K if the
Issuer were required to file such reports or (b) furnished if the Issuer
is a foreign private issuer, to the Commission on Form 6-K if the Issuer
were required to furnish such reports.
The availability of the foregoing materials on either the
Commission's XXXXX service or on the Issuer's website shall be deemed to satisfy
the Issuer's delivery obligation.
All such reports shall be prepared in all material respects in
accordance with all of the rules and regulations applicable to such reports.
Each annual report shall include a report on the Issuer's consolidated financial
statements by the Issuer's certified independent accountants. In addition, the
Issuer shall cause a copy of all of the information and reports referred to in
clauses (1) and (2) above to be posted no later than the date such information
is required to be furnished to registered Holders, on the website of the Issuer
(and remain there for a period of one year from the date of such posting). The
Issuer shall also agree that, for so long as any Notes remain outstanding, if at
any time the Issuer and the Guarantors are not required to file reports under
the Exchange Act with the Commission, the Issuer shall furnish to the Holders
and to securities analysts and prospective investors, upon their request, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act. If any Parent Company has complied with the reporting
requirements of Section 13 or 15(d) of the Exchange Act, if applicable, or has
furnished the Holders or posted on its or the Issuer's website the reports
described herein with respect to such Parent Company (including any
consolidating financial information required by Regulation S-X relating to the
Issuer and the Guarantors), the Issuer shall be deemed to be in compliance with
the provisions of this Section 4.18.
SECTION 4.19. Limitations on Designation of Restricted and Unrestricted
Subsidiaries.
The Board of Directors of Holdings may designate any Restricted
Subsidiary to be an Unrestricted Subsidiary if that designation would not cause
a Default. If a Restricted Subsidiary is designated as an Unrestricted
Subsidiary, the aggregate Fair Market Value of all outstanding Investments owned
by Holdings and the Restricted Subsidiaries in the Subsidiary designated as an
Unrestricted Subsidiary shall be deemed to be an Investment made as of the time
of the designation and shall reduce the amount available for Restricted Payments
under Section 4.11 or under one or more clauses of the definition of "Permitted
Investments," as determined by Holdings. That designation shall only be
permitted if the Investment would be permitted at that time and if the
Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary. The Board of Directors of Holdings may redesignate any Unrestricted
Subsidiary to be a Restricted Subsidiary if that redesignation would not cause a
Default.
SECTION 4.20. Business Activities.
Holdings shall not, and shall not permit any Restricted Subsidiary
to, engage in any business other than Permitted Businesses, except to such
extent as would not be material to the Issuer and its Restricted Subsidiaries
taken as a whole.
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SECTION 4.21. Additional Amounts.
All amounts paid or credited by the Issuer under or with respect to
the Notes, or by any Guarantor pursuant to the Guarantees, shall be made free
and clear of and without withholding or deduction for or on account of any
present or future tax, duty, levy, impost, assessment or other governmental
charge (including penalties, interest and other liabilities or expenses related
thereto) (hereinafter, "TAXES") imposed or levied by or on behalf of the
Government of Canada or the United States or of any province, territory, state
or other political subdivision thereof or by any authority or agency therein or
thereof having power to tax (each, a "RELEVANT TAXING JURISDICTION"), unless the
Issuer or such Guarantor, as the case may be, is required to withhold or deduct
any amount for or on account of Taxes by law or by the interpretation or
administration thereof. If the Issuer or any Guarantor is required to withhold
or deduct any amount for or on account of any such Taxes from any amount paid or
credited under or with respect to the Notes or the Guarantees, the Issuer or
such Guarantor shall pay such additional amounts (the "Additional Amounts") as
may be necessary so that the net amount received by each owner of a beneficial
interest in the Notes (an "owner" for the purposes of this "ADDITIONAL AMOUNTS"
section) (including Additional Amounts) after such withholding or deduction
(including any withholding or deduction in respect of Additional Amounts) shall
not be less than the amount such owner would have received if such Taxes had not
been withheld or deducted; provided, however, that Additional Amounts shall not
be payable to an owner or Holder with respect to any Taxes to the extent such
Taxes ("EXCLUDED TAXES") would not have been imposed but for such owner or
Holder being an owner or Holder:
(1) in the case of Canadian Taxes, with which the Issuer or such
Guarantor does not deal at arm's length (within the meaning of the Income
Tax Act (Canada)) at the time of making a payment;
(2) which is subject to such Taxes by reason of such owner or Holder
being connected with the Relevant Taxing Jurisdiction other than solely by
reason of the mere acquisition or holding of notes, the receipt of
payments thereunder or the enforcement of the Holder's or owner's rights
thereunder;
(3) which failed to duly and timely comply with a timely request of
the Issuer to provide information, documents, certification or other
evidence concerning such owner's or Holder's nationality, residence,
entitlement to treaty benefits, identity or connection with a Relevant
Taxing Authority, but only if such owner or Holder is legally entitled to
comply with such request and only to the extent that due and timely
compliance with such request would have resulted in the reduction or
elimination of the Taxes in question;
(4) in the case of United States Taxes, which do not qualify for the
"portfolio interest exception" contained in Sections 871(h) and 881(c) of
the U.S. Internal Revenue Code of 1986, as amended; or
(5) which is a fiduciary, a partnership or not the beneficial owner
of a Note, if and to the extent that any beneficiary or settlor of such
fiduciary, any partner in such partnership or the beneficial owner of such
Note (as the case may be) would not have
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been entitled to receive Additional Amounts with respect to the payment in
question if such beneficiary, settlor, partner or beneficial owner had
been the Holder of such Note (but only if there is no material cost or
expense associated with transferring such Note to such beneficiary,
settlor, partner or beneficial owner and no restriction on such transfer
that is outside the control of such beneficiary, settlor, partner or
beneficial owner).
The Issuer or such Guarantor shall also (a) make such withholding or deduction
and (b) remit the full amount deducted or withheld to the relevant authority in
accordance with and in the time required under applicable law.
The Issuer or the Guarantor shall furnish the Holders, within 30
days after the date the payment of any Taxes is due pursuant to applicable law,
evidence of such payment by the Issuer or such Guarantor. The Issuer and the
Guarantors shall indemnify and hold harmless each Holder and owner from and
against (x) any Taxes (other than Excluded Taxes) levied or imposed on such
Holder or owner as a result of payments or credits made under or with respect to
the Notes or the Guarantees, and (y) any Taxes (other than Excluded Taxes) so
levied or imposed with respect to any indemnification payments under the
foregoing clause (x) or this clause (y) such that the net amount received by
such Holder or owner after such indemnification payments shall not be less than
the net amount the Holder or owner would have received if the Taxes described in
clauses (x) and (y) above had not been imposed.
At least 30 days prior to each date on which any payment under or
with respect to the Notes is due and payable, if the Issuer or any Guarantor
shall be obligated to pay Additional Amounts with respect to such payment, the
Issuer or such Guarantor shall deliver to the Trustee an Officers' Certificate
stating the fact that such Additional Amounts shall be payable and the amounts
so payable and shall set forth such other information necessary to enable the
Trustee to pay such Additional Amounts to holders or owners on the payment date.
Whenever in this Indenture there is mentioned, in any context, the payment of
principal, premium, if any, redemption price, Change of Control Payment, Asset
Sale Offer purchase price, interest or any other amount payable under or with
respect to any Note, such mention shall be deemed to include mention of the
payment of Additional Amounts or indemnification payments to the extent that, in
such context, Additional Amounts or indemnification payments are, were or would
be payable in respect thereof.
The Issuer and the Guarantors shall pay any present or future stamp,
court, documentary or other excise or property Taxes, charges or similar levies
that arise in any Relevant Taxing Jurisdiction from the execution, delivery or
registration of, or enforcement of rights under, the Notes, this Indenture, any
Guarantee or any related document ("DOCUMENTARY TAXES").
The obligation to pay any Additional Amounts (and any associated
indemnification payments) and Documentary Taxes under the terms and conditions
described above shall survive any termination, defeasance or discharge of this
Indenture.
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ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Consolidations, Etc.
(a) The Issuer may not, directly or indirectly: (1) consolidate,
amalgamate or merge with or into another Person (whether or not the Issuer is
the surviving Person); or (2) sell, assign, transfer, convey or otherwise
dispose of all or substantially all of the properties or assets of the Issuer
and its Restricted Subsidiaries taken as a whole, in one or more related
transactions, to another Person, unless:
(1) either: (a) the Issuer is the surviving Person; or (b) the
Person formed by or surviving any such consolidation, amalgamation or
merger (if other than the Issuer) or to which such sale, assignment,
transfer, conveyance or other disposition has been made (x) is a Nova
Scotia unlimited company or a corporation, limited liability company or
limited partnership organized or existing under the laws of Canada, any
province or territory thereof, the United States, any state of the United
States or the District of Columbia and (y) assumes all the obligations of
the Issuer under the Notes, this Indenture and the registration rights
agreement pursuant to agreements reasonably satisfactory to the Trustee;
(2) immediately after such transaction, no Default or Event of
Default exists; and
(3) either (a) the Issuer or the Person formed by or surviving any
such consolidation, amalgamation or merger (if other than the Issuer), or
to which such sale, assignment, transfer, conveyance or other disposition
has been made, shall, on the date of such transaction after giving pro
forma effect thereto and to any related financing transactions as if the
same had occurred at the beginning of the applicable four-quarter period,
be permitted to incur at least US$1.00 of additional Indebtedness pursuant
to the Fixed Charge Coverage Ratio test set forth in Section 4.10(a) or
(b) the Fixed Charge Coverage Ratio of Holdings or the Person formed by or
surviving any such consolidation, amalgamation or merger (if other than
the Issuer), or to which such sale, assignment, transfer, conveyance or
other disposition has been made, after giving effect to the transaction
and any related financings, would not be less than the Fixed Charge
Coverage Ratio of Holdings immediately prior to such transaction.
In addition, the Issuer may not, directly or indirectly, lease all
or substantially all of its properties or assets, in one or more related
transactions, to any other Person.
For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise, in a single transaction or series of transactions) of all or
substantially all of the properties or assets of one or more Restricted
Subsidiaries, the Equity Interests of which constitute all or substantially all
of the properties and assets of the Issuer, shall be deemed to be the transfer
of all or substantially all of the properties and assets of the Issuer.
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(b) Holdings may not, directly or indirectly: (1) consolidate,
amalgamate or merge with or into another Person (whether or not Holdings is the
surviving Person); or (2) sell, assign, transfer, convey or otherwise dispose of
all or substantially all of the properties or assets of Holdings and the
Restricted Subsidiaries taken as a whole, in one or more related transactions,
to another Person, unless:
(1) either: (a) Holdings is the surviving Person; or (b) the Person
formed by or surviving any such consolidation, amalgamation or merger (if
other than Holdings) or to which such sale, assignment, transfer,
conveyance or other disposition has been made (x) is a Nova Scotia
unlimited company or a corporation, limited liability company or limited
partnership organized or existing under the laws of Canada, any province
or territory thereof, the United States, any state of the United States or
the District of Columbia and (y) assumes all the obligations of Holdings
under the Guarantee, this Indenture and the registration rights agreement
pursuant to agreements reasonably satisfactory to the Trustee;
(2) immediately after such transaction, no Default or Event of
Default exists; and
(3) either (a) Holdings or the Person formed by or surviving any
such consolidation, amalgamation or merger (if other than Holdings), or to
which such sale, assignment, transfer, conveyance or other disposition has
been made shall, on the date of such transaction after giving pro forma
effect thereto and any related financing transactions as if the same had
occurred at the beginning of the applicable four-quarter period, be
permitted to incur at least US$1.00 of additional Indebtedness pursuant to
Section 4.10(a) or (b) the Fixed Charge Coverage Ratio of Holdings or the
Person formed by or surviving any such consolidation, amalgamation or
merger (if other than Holdings), or to which such sale, assignment,
transfer, conveyance or other disposition has been made, after giving
effect to the transaction and any related financings, would not be less
than the Fixed Charge Coverage Ratio of Holdings immediately prior to such
transaction.
In addition, Holdings may not, directly or indirectly, lease all or
substantially all of its properties or assets, in one or more related
transactions, to any other Person.
For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise, in a single transaction or series of transactions) of all or
substantially all of the properties or assets of one or more Restricted
Subsidiaries, the Equity Interests of which constitute all or substantially all
of the properties and assets of Holdings, shall be deemed to be the transfer of
all or substantially all of the properties and assets of Holdings.
(c) This Section 5.01 shall not apply to a merger of the Issuer or a
Guarantor with an Affiliate solely for the purpose, and with the effect, of
reincorporating the Issuer or such Guarantor, as the case may be, in another
jurisdiction of the United States or Canada. In addition, nothing in this
Section 5.01 shall prohibit any Restricted Subsidiary from consolidating or
amalgamating with, merging with or into or conveying, transferring or leasing,
in one transaction or a series of transactions, all or substantially all of its
assets to Holdings or another Restricted Subsidiary.
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ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
Each of the following is an "EVENT OF DEFAULT":
(1) default for 30 days in the payment when due of interest on, or
Special Interest with respect to, the Notes (whether or not such payment
is prohibited by the subordination provisions of this Indenture);
(2) default in payment when due of the principal of, or premium, if
any, on the Notes (whether or not such payment is prohibited by the
subordination provisions of this Indenture);
(3) failure by Holdings or any Restricted Subsidiary to comply (a)
for 30 days after written notice with the provisions described under
Sections 4.09 and 4.13 or (b) with Section 5.01;
(4) failure by Holdings or any Restricted Subsidiary for 60 days
after written notice has been given to the Issuer by the Trustee or to the
Issuer and the Trustee by the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding to comply with any of the
other agreements in this Indenture;
(5) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by Holdings or any Restricted Subsidiary
(or the payment of which is guaranteed by Holdings or any Restricted
Subsidiary), whether such Indebtedness or guarantee now exists or is
created after the Issue Date, if that default:
(a) is caused by a failure to pay any such Indebtedness at its
stated final maturity after giving effect to any applicable grace
periods (a "PAYMENT DEFAULT"); or
(b) results in the acceleration of such Indebtedness prior to
its stated final maturity,
and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness under
which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates US$20.0 million or more;
(6) failure by Holdings or any Restricted Subsidiary to pay final
judgments aggregating in excess of US$20.0 million in excess of amounts
that are covered by insurance, which judgments are not paid, discharged or
stayed for a period of 60 days;
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(7) except as permitted by this Indenture, the Guarantee of Holdings
or any Restricted Subsidiary that is a Significant Subsidiary shall be
held in any judicial proceeding to be unenforceable or invalid or shall
cease for any reason to be in full force and effect or any Guarantor, or
any Person acting on behalf of any Guarantor, shall deny or disaffirm its
obligations under its Guarantee;
(8) Holdings, the Issuer or any of Holdings' Restricted Subsidiaries
that is a Significant Subsidiary or any group of Restricted Subsidiaries
that, taken together, would constitute a Significant Subsidiary as debtor
in an involuntary case, pursuant to or within the meaning of any
Bankruptcy Law:
(a) commences a voluntary case or proceeding,
(b) consents to the entry of an order for relief or decree
against it in an involuntary case or proceeding,
(c) consents to the appointment of a Custodian of it or for
all or substantially all of its assets, or
(d) makes a general assignment for the benefit of its
creditors;
(e) admits in writing its inability to pay its debts generally
as they become due; or
(f) files a petition or answer or consent seeking
reorganization or relief.
(9) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(a) is for relief against Holdings, the Issuer or any of
Holdings' Restricted Subsidiaries that is a Significant Subsidiary
or any group of Restricted Subsidiaries that, taken together, would
constitute a Significant Subsidiary as debtor in an involuntary case
or proceeding;
(b) appoints a Custodian of Holdings, the Issuer or any of
Holdings' Restricted Subsidiaries that is a Significant Subsidiary
or any group of Restricted Subsidiaries that, taken together, would
constitute a Significant Subsidiary, or a Custodian for all or
substantially all of the assets of Holdings, the Issuer or any of
Holdings' Restricted Subsidiaries that is a Significant Subsidiary
or any group of Restricted Subsidiaries that, taken together, would
constitute a Significant Subsidiary or adjudges any such entity or
group a bankrupt or insolvent or approves as properly filed a
petition seeking reorganization, arrangement, adjustment or
composition of or in respect of such entity or group; or
(c) orders the winding up or liquidation of Holdings, the
Issuer or any of Holdings' Restricted Subsidiaries that is a
Significant Subsidiary or any group
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of Restricted Subsidiaries that, taken together, would constitute a
Significant Subsidiary.
and the order or decree remains unstayed and in effect for 60 consecutive
days; and
(10) the amalgamation contemplated by the merger agreement described
under "Summary -- The Transactions" is not consummated on or before June
7, 2004.
SECTION 6.02. Acceleration.
(a) In the case of an Event of Default specified in clause (8) or
(9) of Section 6.01, with respect to Holdings, the Issuer, any Restricted
Subsidiary that is a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken together, would constitute a Significant Subsidiary, or
an Event of Default specified in clause (10) of Section 6.01 occurs, all
outstanding Notes shall become due and payable immediately without further
action or notice. If any other Event of Default occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes may declare (an "ACCELERATION DECLARATION") all the Notes to
be due and payable. Upon an acceleration declaration, the aggregate principal of
and accrued and unpaid interest on the outstanding Notes shall become due and
payable immediately without further action or notice (a) if there is no
Indebtedness outstanding under any Credit Facility at such time, immediately and
(b) if otherwise, upon the earlier of (x) the final maturity (after giving
effect to any applicable grace period or extensions thereof) or an acceleration
of any Indebtedness under any Credit Facility prior to the express final stated
maturity thereof and (y) five business days after the Representative under each
Credit Facility receives the acceleration declaration, but, in the case of this
clause (b) only, if such Event of Default is then continuing; provided, however,
that after such acceleration, but before a judgment or decree based on
acceleration, the Holders of a majority in aggregate principal amount of such
outstanding Notes may rescind and annul such acceleration:
(1) if the rescission would not conflict with any judgment or
decree;
(2) if all existing Events of Default have been cured or waived
except non-payment of principal and interest that has become due solely
because of this acceleration;
(3) if the Issuer has paid to the Trustee its reasonable
compensation and reimbursed the Trustee of its expenses, disbursements and
advances; and
(4) in the event of a cure or waiver of an Event of Default of the
type set forth in Section 6.01(8) or (9), the Trustee shall have received
an Officers' Certificate and an Opinion of Counsel that such Event of
Default has been cured or waived.
No such rescission shall affect any subsequent Default or impair any right
consequent thereto.
In addition, in the event of an acceleration declaration because an
Event of Default has occurred and is continuing as a result of the acceleration
of any Indebtedness described in clause (5) of Section 6.01, the acceleration
declaration shall be automatically annulled if the holders of any Indebtedness
described in clause (5) have rescinded the declaration of acceleration in
respect of such Indebtedness and if (x) the annulment of the acceleration of the
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notes would not conflict with any judgment or decree of a court of competent
jurisdiction and (y) all existing Events of Default, except nonpayment of
principal or interest on the notes that became due solely because of the
acceleration of the notes, have been cured or waived.
SECTION 6.03. Other Remedies.
If a Default occurs and is continuing, the Trustee may pursue any
available remedy by proceeding at law or in equity to collect the payment of
principal of, or interest on, the Notes or to enforce the performance of any
provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. No remedy is exclusive of any
other remedy. All available remedies are cumulative to the extent permitted by
law.
SECTION 6.04. Waiver of Past Defaults.
Subject to Sections 2.09, 6.07 and 9.02, the Holders of a majority
in principal amount of the outstanding Notes (which may include consents
obtained in connection with a tender offer or exchange offer of Notes) by notice
to the Trustee may waive an existing Default or Event of Default and its
consequences, except a Default or Event of Default in the payment of principal
of, or interest or premium on, any Note as specified in Section 6.01(1) or (2).
The Issuer shall deliver to the Trustee an Officers' Certificate stating that
the requisite percentage of Holders have consented to such waiver and attaching
copies of such consents. When a Default or Event of Default is waived, it is
cured and ceases.
SECTION 6.05. Control by Majority.
The Holders of not less than a majority in principal amount of the
outstanding Notes may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on it. Subject to Section 7.01, however, the Trustee may refuse
to follow any direction that conflicts with any law or this Indenture, that the
Trustee determines may be unduly prejudicial to the rights of another Holder, or
that may involve the Trustee in personal liability; provided that the Trustee
may take any other action deemed proper by the Trustee which is not inconsistent
with such direction.
In the event the Trustee takes any action or follows any direction
pursuant to this Indenture, the Trustee shall be entitled to indemnification
against any loss or expense caused by taking such action or following such
direction.
SECTION 6.06. Limitation on Suits.
No Holder shall have any right to institute any proceeding with
respect to this Indenture or for any remedy thereunder, unless:
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(1) such Holder has previously given the Trustee written notice that
an Event of Default is continuing;
(2) Holders of at least 25% in aggregate principal amount of the
outstanding Notes have requested in writing that the Trustee pursue the
remedy;
(3) such Holders have offered the Trustee reasonable security or
indemnity against any loss, liability or expense;
(4) the Trustee has not complied with such request within 60 days
after the receipt thereof and the offer of security or indemnity; and
(5) Holders of a majority in aggregate principal amount of the
outstanding Notes have not given the Trustee a written direction
inconsistent with such request within such 60-day period.
However, such limitations do not apply to a suit instituted by a Holder of any
Note for enforcement of payment of the principal of or interest or premium on
such Note on or after the due date therefor (after giving effect to the grace
period specified in Section 6.01(1)).
A Holder may not use this Indenture to prejudice the rights of
another Holder or to obtain a preference or priority over such other Holder.
SECTION 6.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of principal of, and interest on, a Note, on or
after the respective due dates therefor, or to bring suit for the enforcement of
any such payment on or after such respective dates, shall not be impaired or
affected without the consent of the Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal, interest and premium
specified in Section 6.01(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Issuer or any other obligor on the Notes for the whole amount of principal and
accrued interest and fees remaining unpaid, together with interest on overdue
principal and, to the extent that payment of such interest is lawful, interest
on overdue installments of interest, in each case at the rate per annum borne by
the Notes and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel) and the Holders allowed in any
judicial proceedings relating to the Issuer, their creditors or their
70
property and shall be entitled and empowered to collect and receive any monies
or other property payable or deliverable on any such claims and to distribute
the same, and any Custodian in any such judicial proceedings is hereby
authorized by each Holder to make such payments to the Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agent and
counsel, and any other amounts due the Trustee under Section 7.07. Nothing
herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding. The Trustee shall be entitled
to participate as a member of any official committee of creditors in the matters
as it deems necessary or advisable.
SECTION 6.10. Priorities.
If the Trustee collects any money or property pursuant to this
Article Six, it shall pay out the money or property in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for interest accrued on the Notes, ratably,
without preference or priority of any kind, according to the amounts due
and payable on the Notes for interest;
Third: to Holders for principal amounts due and unpaid on the Notes,
ratably, without preference or priority of any kind, according to the
amounts due and payable on the Notes for principal; and
Fourth: to the Issuer or, if applicable, the Guarantors, as their
respective interests may appear.
The Trustee, upon prior notice to the Issuer, may fix a record date
and payment date for any payment to Holders pursuant to this Section 6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.07, or a suit by a Holder or Holders of more than
10% in principal amount of the outstanding Notes.
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ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties as are specifically
set forth herein or in the Trust Indenture Act and no duties, covenants,
responsibilities or obligations shall be implied in this Indenture against
the Trustee.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates (including Officers'
Certificates) or opinions (including Opinions of Counsel) furnished to the
Trustee and conforming to the requirements of this Indenture. However, in
the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall examine the certificates and opinions to determine whether
or not they conform to the requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein, the Trustee may
not be relieved from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(1) This paragraph does not limit the effect of Section 7.01(b).
(2) The Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or to take or omit to take any action
under this Indenture or take any action at the request or direction of Holders
if it shall have reasonable grounds for believing that repayment of such funds
is not assured to it.
(e) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to this Section
7.01.
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(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuer. Money
held in trust by the Trustee need not be segregated from other funds except to
the extent required by law.
(g) In the absence of bad faith, negligence or willful misconduct on
the part of the Trustee, the Trustee shall not be responsible for the
application of any money by any Paying Agent other than the Trustee.
SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may rely conclusively on any resolution, certificate
(including any Officers' Certificate), statement, instrument, opinion
(including any Opinion of Counsel), notice, request, direction, consent,
order, bond, debenture, or other paper or document believed by it to be
genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate and an Opinion of Counsel, which shall conform to
the provisions of Section 12.05. The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on such
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent (other
than an agent who is an employee of the Trustee) appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it reasonably believes to be authorized or
within its rights or powers under this Indenture.
(e) The Trustee may consult with counsel of its selection and the
advice or opinion of such counsel as to matters of law shall be full and
complete authorization and protection from liability in respect of any
action taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture whether on its own motion
or at the request, order or direction of any of the Holders pursuant to
the provisions of this Indenture, unless such Holders shall have offered
to the Trustee reasonable security or indemnity satisfactory to it against
the costs, expenses and liabilities which may be incurred therein or
thereby.
(g) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate (including any
Officers' Certificate), statement, instrument, opinion (including any
Opinion of Counsel), notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters
as it may see fit and, if the Trustee shall determine to make such further
inquiry or
73
investigation, it shall be entitled, upon reasonable notice to the Issuer,
to examine the books, records, and premises of the Issuer, personally or
by agent or attorney at the sole cost of the Issuer.
(h) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
(i) The permissive rights of the Trustee to do things enumerated in
this Indenture shall not be construed as duties.
(j) Except with respect to Section 4.01 and 4.06, the Trustee shall
have no duty to inquire as to the performance of the Issuer with respect
to the covenants contained in Article Four. In addition, the Trustee shall
not be deemed to have knowledge of a Default or Event of Default except
(i) any Default or Event of Default occurring pursuant to Sections 4.01,
6.01(1) or 6.01(2) or (ii) any Default or Event of Default of which the
Trustee shall have received written notification.
(k) The rights, privileges, protections, immunities and benefits
given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in
each of its capacities hereunder, and to each agent, custodian and other
Person employed to act hereunder.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Issuer, its
Subsidiaries or its respective Affiliates with the same rights it would have if
it were not Trustee. However, in the event that the Trustee acquires any
conflicting interest it must eliminate such conflict within 90 days, apply to
the Commission for permission to continue as Trustee (if this Indenture has been
qualified under the TIA) or resign. Any Agent may do the same with like rights.
However, the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuer's use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuer in this Indenture or any
document issued in connection with the sale of Notes or any statement in the
Notes other than the Trustee's certificate of authentication. The Trustee makes
no representations with respect to the effectiveness or adequacy of this
Indenture.
SECTION 7.05. Notice of Default.
If a Default or Event of Default occurs and is continuing and the
Trustee receives actual notice of such Default or Event of Default, the Trustee
shall mail to each Holder notice of the uncured Default or Event of Default
within 30 days after such Default or Event of Default occurs. Except in the case
of a Default in payment of principal of, or interest on, any Note, including an
accelerated payment and the failure to make a payment on the Change of Control
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Payment Date pursuant to a Change of Control Offer or the Asset Sale Payment
Date pursuant to a Asset Sale Offer, the Trustee may withhold the notice if and
so long as the Board of Directors, the executive committee, or a trust committee
of directors and/or Responsible Officers, of the Trustee in good faith
determines that withholding the notice is in the interest of the Holders.
SECTION 7.06. Reports by Trustee to Holders.
Within 60 days after each August 15, beginning with August 15, 2005,
the Trustee shall, to the extent that any of the events described in Trust
Indenture Act Section 313(a) occurred within the previous twelve months, but not
otherwise, mail to each Holder a brief report dated as of such date that
complies with Trust Indenture Act Section 313(a). The Trustee also shall comply
with Trust Indenture Act Sections 313(b), 313(c) and 313(d).
A copy of each report at the time of its mailing to Holders shall be
mailed by the Trustee to the Issuer and filed by the Trustee with the SEC and
each securities exchange, if any, on which the Notes are listed.
The Issuer shall notify the Trustee if the Notes become listed on
any securities exchange or of any delisting thereof and the Trustee shall comply
with Trust Indenture Act Section 313(d).
SECTION 7.07. Compensation and Indemnity.
The Issuer shall pay to the Trustee from time to time such
compensation as the Issuer and the Trustee shall from time to time agree in
writing for its services hereunder. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Issuer
shall reimburse the Trustee promptly upon request for all reasonable
disbursements, expenses and advances (including reasonable fees and expenses of
counsel) incurred or made by it in addition to the compensation for its
services, except any such disbursements, expenses and advances as may be
attributable to the Trustee's negligence, bad faith or willful misconduct. Such
expenses shall include the reasonable fees and expenses of the Trustee's agents
and counsel.
The Issuer shall indemnify each of the Trustee or any predecessor
Trustee and its agents for, and hold them harmless against, any and all loss,
damage, claims including taxes (other than taxes based upon, measured by or
determined by the income of the Trustee), liability or expense incurred by them
except for such actions to the extent caused by any negligence, bad faith or
willful misconduct on their part, arising out of or in connection with the
acceptance or administration of this trust including the reasonable costs and
expenses of defending themselves against or investigating any claim or liability
in connection with the exercise or performance of any of the Trustee's rights,
powers or duties hereunder. The Trustee shall notify the Issuer promptly of any
claim asserted against the Trustee or any of its agents for which it may seek
indemnity. The Issuer shall defend the claim and the Trustee shall cooperate in
the defense. The Trustee and its agents subject to the claim may have separate
counsel and the Issuer shall pay the reasonable fees and expenses of such
counsel; provided, however, that the Issuer shall not be required to pay such
fees and expenses if there is no conflict of interest between the Issuer and the
Trustee and its agents subject to the claim in connection with such defense as
reasonably
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determined by the Trustee. The Issuer need not pay for any settlement made
without its written consent. The Issuer need not reimburse any expense or
indemnify against any loss or liability to the extent incurred by the Trustee
through the Trustee's negligence, bad faith or willful misconduct.
To secure the Issuer's payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Notes against all money or property held
or collected by the Trustee, in its capacity as Trustee, except money or
property held in trust to pay principal and interest on particular Notes. The
obligations of the Issuer and the Guarantors under this Section shall not be
subordinated to the payment of Senior Debt pursuant to Article Ten or Section
11.02 except assets or money held in trust to pay principal of or interest on
particular Notes.
When the Trustee incurs expenses or renders services after a Default
specified in Section 6.01(8) or (9) occurs, such expenses and the compensation
for such services shall be paid to the extent allowed under any Bankruptcy Law.
Notwithstanding any other provision in this Indenture, the foregoing
provisions of this Section 7.07 shall survive the satisfaction and discharge of
this Indenture or the appointment of a successor Trustee.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign at any time by so notifying the Issuer in
writing. The Holders of a majority in principal amount of the outstanding Notes
may remove the Trustee by so notifying the Issuer and the Trustee and may
appoint a successor Trustee. The Issuer may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(3) a receiver or other public officer takes charge of the Trustee
or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuer shall notify each Holder of such
event and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount of
the Notes may appoint a successor Trustee to replace the successor Trustee
appointed by the Issuer.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Immediately after that,
the retiring Trustee shall transfer, after payment of all sums then owing to the
Trustee pursuant to Section 7.07, all property held by it as Trustee to the
successor Trustee, subject to the Lien provided in Section 7.07, the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all
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the rights, powers and duties of the Trustee under this Indenture. A successor
Trustee shall mail notice of its succession to each Holder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer or the
Holders of at least 10% in principal amount of the outstanding Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee at the expense of the Issuer.
If the Trustee fails to comply with Section 7.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Issuer's obligations under Section 7.07 shall continue for the benefit
of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee; provided that such
corporation shall be otherwise qualified and eligible under this Article Seven.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirement of Trust Indenture Act Sections 310(a)(1), 310(a)(2) and 310(a)(5).
The Trustee shall have a combined capital and surplus of at least US$100,000,000
as set forth in its most recent published annual report of condition. The
Trustee shall comply with Trust Indenture Act Section 310(b); provided, however,
that there shall be excluded from the operation of Trust Indenture Act Section
310(b)(1) any indenture or indentures under which other securities, or
certificates of interest or participation in other securities, of the Issuer are
outstanding, if the requirements for such exclusion set forth in Trust Indenture
Act Section 310(b)(1) are met. The provisions of Trust Indenture Act Section 310
shall apply to the Issuer and any other obligor of the Notes.
SECTION 7.11. Preferential Collection of Claims Against the Issuer.
The Trustee, in its capacity as Trustee hereunder, shall comply with
Trust Indenture Act Section 311(a), excluding any creditor relationship listed
in Trust Indenture Act Section 311(b). A Trustee who has resigned or been
removed shall be subject to Trust Indenture Act Section 311(a) to the extent
indicated.
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ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Termination of the Issuer's Obligations.
The Issuer may terminate its obligations under the Notes and this
Indenture and the obligations of the Guarantors under the Note Guarantees and
this Indenture and this Indenture shall cease to be of further effect, except
those obligations referred to in the penultimate paragraph of this Section 8.01,
when:
(a) either:
(1) all the Notes that have been authenticated and delivered, except
lost, stolen or destroyed Notes that have been replaced or paid and Notes
for whose payment money has been deposited in trust or segregated and held
in trust by the Issuer and thereafter repaid to the Issuer or discharged
from the trust, have been delivered to the Trustee for cancellation, or
(2) all Notes that have not been delivered to the Trustee for
cancellation otherwise have become due and payable by reason of a mailing
of a notice of redemption or otherwise, will become due and payable within
one year, or may be called for redemption, within one year or have been
called for redemption pursuant to Section 5, Section 6 or Section 10 of
the Notes and the Issuer or any Guarantor has irrevocably deposited or
caused to be deposited with the Trustee as trust funds in trust solely for
the benefit of the Holders, cash in U.S. dollars, non-callable Government
Securities or a combination of cash in U.S. dollars and non-callable
Government Securities, in amounts as shall be sufficient, without
consideration of any reinvestment of interest, to pay and discharge the
entire Indebtedness on the Notes not delivered to the Trustee for
cancellation, for principal, premium and Special Interest, if any, and
accrued interest to the date of maturity or redemption,
(b) the Issuer or any Guarantor has paid or caused to be paid all
sums payable by it under this Indenture, and
(c) the Issuer has delivered irrevocable instructions to the Trustee
to apply the deposited money toward the payment of the Notes at maturity
or the Redemption Date, as the case may be.
In addition, the Issuer must deliver an Officers' Certificate and an
Opinion of Counsel stating that all conditions precedent to satisfaction and
discharge have been complied with.
In the case of clause (2) of this Section 8.01, and subject to the
next sentence and notwithstanding the foregoing paragraph, the Issuer's
obligations in Sections 2.05, 2.06, 2.07, 2.08, 4.01, 4.02, 4.03 (as to legal
existence of the Issuer only), 7.07, 8.07 and 8.08 shall survive until the Notes
are no longer outstanding pursuant to the last paragraph of Section 2.08. After
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the Notes are no longer outstanding, the Issuer's obligations in Sections 4.21,
7.07, 8.05 and 8.06 shall survive.
After such delivery or irrevocable deposit, the Trustee upon request
shall acknowledge in writing the discharge of the Issuer's obligations under the
Notes and this Indenture except for those surviving obligations specified above.
SECTION 8.02. Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at the option of its Board of Directors evidenced
by a resolution set forth in an Officers' Certificate, and at any time, elect to
have either Section 8.03 or 8.04 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
SECTION 8.03. Legal Defeasance.
Upon the Issuer's exercise under Section 8.02 of the option
applicable to this Section 8.03, the Issuer and each of the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.05, be
deemed to have been discharged from their obligations with respect to all
outstanding Notes (including the Guarantees) on the date the conditions set
forth below are satisfied (hereinafter, "Legal Defeasance"). For this purpose,
Legal Defeasance means that the Issuer and the Guarantors shall be deemed to
have paid and discharged the entire Indebtedness represented by the outstanding
Notes (including the Guarantees), which shall thereafter be deemed to be
"outstanding" only for the purposes of Section 8.06 and the other Sections of
this Indenture referred to in clauses (1) and (2) below, and to have satisfied
all of their other obligations under such Notes, the Subsidiary Guarantees and
this Indenture (and the Trustee, on demand of and at the expense of the Issuer,
shall execute proper instruments acknowledging the same), except for the
following provisions which shall survive until otherwise terminated or
discharged hereunder:
(1) the rights of Holders of outstanding Notes to receive payments
in respect of the principal of, or interest or premium and Special
Interest, if any, on such Notes when such payments are due from the trust
referred to in Section 8.06;
(2) the Issuer's obligations with respect to such Notes under
Article 2 and Section 4.02;
(3) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and the Issuer's and the Guarantors' obligations in connection
therewith; and
(4) Section 4.21 and this Article 8.
Subject to compliance with this Article 8, the Issuer may exercise its option
under this Section 8.03 notwithstanding the prior exercise of its option under
Section 8.04.
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SECTION 8.04. Covenant Defeasance.
Upon the Issuer's exercise under Section 8.02 of the option applicable to
this Section 8.04, the Issuer and each of the Guarantors shall, subject to the
satisfaction of the conditions set forth in Section 8.05, be released from each
of their obligations under the covenants contained in Sections 4.03 (other than
with respect to the legal existence of the Issuer), 4.04, 4.07, 4.09 through
4.21, clause (3) of Section 5.01(a) and clause (3) of Section 5.01(b) with
respect to the outstanding Notes on and after the date the conditions set forth
in Section 8.05 are satisfied (hereinafter, "Covenant Defeasance"), and the
Notes shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes and Guarantees, the Issuer and the Guarantors may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any other
document and such omission to comply shall not constitute a Default or an Event
of Default under Section 6.01, but, except as specified above, the remainder of
this Indenture and such Notes and Subsidiary Guarantees shall be unaffected
thereby. In addition, upon the Issuer's exercise under Section 8.02 of the
option applicable to this Section 8.04, subject to the satisfaction of the
conditions set forth in Section 8.04, Sections 6.01(3) through 6.01(6) and
Section 6.01(8) shall not constitute Events of Default.
SECTION 8.05. Conditions to Legal or Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant Defeasance
under either Sections 8.03 or 8.04:
(1) the Issuer must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, cash in U.S. dollars, non-callable
Government Securities, or a combination thereof, in such amounts as shall
be sufficient, without consideration of any reinvestment of interest, in
the opinion of an investment bank, appraisal firm, or firm of independent
public accountants nationally recognized in the United States, to pay the
principal of, premium and Special Interest, if any, and interest on the
outstanding Notes on the Stated Maturity or on the applicable Redemption
Date, as the case may be, and the Issuer must specify whether the Notes
are being defeased to maturity or to a particular Redemption Date;
(2) in the case of an election under Section 8.03 hereof, the Issuer
must deliver to the Trustee an Opinion of Counsel reasonably acceptable to
the Trustee confirming that:
(A) the Issuer has received from, or there has been published
by, the U.S. Internal Revenue Service a ruling; or
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(B) since the date of this Indenture, there has been a change
in the applicable U.S. federal income tax law,
in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders of the outstanding Notes shall not
recognize income, gain or loss for federal income tax purposes as a result
of such Legal Defeasance and shall be subject to U.S. federal income tax
on the same amounts, in the same manner and at the same times as would
have been the case if such Legal Defeasance had not occurred;
(3) in the case of an election under Section 8.04, the Issuer must
deliver to the Trustee an Opinion of Counsel reasonably acceptable to the
Trustee confirming that the Holders of the outstanding Notes shall not
recognize income, gain or loss for U.S. federal income tax purposes as a
result of such Covenant Defeasance and shall be subject to U.S. federal
income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Covenant Defeasance had not occurred;
(4) in the case of an election under Section 8.03 or 8.04, the
Issuer must deliver to the Trustee an Opinion of Counsel reasonably
acceptable to the Trustee confirming that the Holders and beneficial
owners of the outstanding Notes shall not recognize income, gain or loss
for Canadian federal, provincial, territorial income tax or other tax
purposes as a result of such Legal Defeasance or Covenant Defeasance, as
applicable, and shall be subject to Canadian federal, provincial or
territorial income tax and other tax on the same amounts, in the same
manner and at the same times as would have been the case if such Legal
Defeasance or Covenant Defeasance, as the case may be, had not occurred
(which condition may not be waived by any Holder of outstanding Notes or
the Trustee);
(5) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such
deposit);
(6) such Legal Defeasance or Covenant Defeasance shall not result in
a breach or violation of, or constitute a default under, any material
agreement or instrument (other than this Indenture) to which Holdings, the
Issuer or any of Holdings' Restricted Subsidiaries that are Significant
Subsidiaries is a party or by which Holdings, the Issuer or any of
Holdings' Restricted Subsidiaries that are Significant Subsidiaries is
bound;
(7) the Issuer must deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Issuer with the intent of
preferring the Holders over the other creditors of the Issuer with the
intent of defeating, hindering, delaying or defrauding creditors of the
Issuer or others; and
(8) the Issuer must deliver to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
relating to the Legal Defeasance or the Covenant Defeasance have been
complied with.
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SECTION 8.06. Deposited Money and Government Securities to Be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.07, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.06, the
"Trustee") pursuant to Article Eight in respect of the outstanding Notes shall
be held in trust and applied by the Trustee, in accordance with the provisions
of such Notes and this Indenture, to the payment, either directly or through any
Paying Agent as the Trustee may determine, to the Holders of such Notes of all
sums due and to become due thereon in respect of principal, premium and Special
Interest, if any, and interest, but such money need not be segregated from other
funds except to the extent required by law.
The Issuer shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.05 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Notwithstanding anything in this Article 8 to the contrary, the
Trustee shall deliver or pay to the Issuer from time to time upon the request of
the Issuer any money or non-callable Government Securities held by it as
provided in Section 8.04 which, in the opinion of a firm of independent public
accountants nationally recognized in the United States expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.04(1)), are in excess of the amount thereof that would
then be required to be deposited to effect an equivalent Legal Defeasance or
Covenant Defeasance.
SECTION 8.07. Repayment to Issuer.
Any money deposited with the Trustee or any Paying Agent, in trust
for the payment of the principal of, premium or Special Interest, if any, or
interest on any Note and remaining unclaimed for two years after such principal,
premium or Special Interest, if any, or interest has become due and payable
shall be paid to the Issuer on its request or shall be discharged from such
trust; and the Holder of such Note shall thereafter be permitted to look only to
the Issuer for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Issuer as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Issuer cause to be published once, in the New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining shall be repaid to the Issuer.
SECTION 8.08. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with this Article
VIII, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or
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otherwise prohibiting such application, then the Issuer's and the Guarantors'
obligations under this Indenture and the Notes and the Subsidiary Guarantees
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article VIII until such time as the Trustee or Paying Agent is permitted to
apply all such money in accordance with this Article VIII, as the case may be;
provided, however, that, if the Issuer makes any payment of principal of,
premium or Special Interest, if any, or interest on any Note following the
reinstatement of its obligations, the Issuer shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the money held by the
Trustee or Paying Agent.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
(a) Subject to Section 9.03, the Issuer, the Guarantors and the
Trustee, together, may amend or supplement this Indenture, the Notes or the Note
Guarantees without notice to or consent of any Holder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in place
of certificated Notes;
(3) to provide for the assumption of the Issuer's or a Guarantor's
obligations to Holders and Guarantees in the case of a merger or
consolidation or sale of all or substantially all of the Issuer's or such
Guarantor's assets, as applicable;
(4) to make any change that would provide any additional rights or
benefits to the Holders or that does not materially adversely affect the
legal rights under this Indenture of any such Holder;
(5) to comply with requirements of the Commission in order to effect
or maintain the qualification of this Indenture under the Trust Indenture
Act;
(6) to allow any Guarantor to execute a supplemental indenture and a
Guarantee with respect to the Notes; or
(7) to evidence and provide for the acceptance of appointment under
this Indenture by a successor Trustee.
provided that the Issuer has delivered to the Trustee an Opinion of Counsel and
an Officers' Certificate, each stating that such amendment or supplement
complies with the provisions of this Section 9.01.
No amendment of, or supplement or waiver to, this Indenture shall
adversely affect the rights of any Holder of Senior Debt under the subordination
provisions of this Indenture, without the consent of such Holder or, in
accordance with the terms of such Senior
83
Debt, the consent of the agent or representative of such Holder or the requisite
Holders of such Senior Debt.
SECTION 9.02. With Consent of Holders.
(a) Subject to Sections 6.07 and 9.03, the Issuer, the Guarantors
and the Trustee, together, with the written consent of the Holder or Holders of
at least a majority in aggregate principal amount of the Notes then outstanding
(including, without limitation, consents obtained in connection with a purchase
of, or tender offer or exchange offer for, Notes), may amend or supplement this
Indenture, the Notes or the Note Guarantees, and any existing Default or Event
of Default or compliance with any provision of this Indenture or the Notes or
the Guarantees may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes (including, without limitation,
consents obtained in connection with a purchase of, or tender offer or exchange
offer for, Notes). Subject to Sections 6.07 and 9.03, the Holder or Holders of a
majority in aggregate principal amount of the outstanding Notes may waive
compliance with any provision of this Indenture, the Notes or the Note
Guarantees without notice to any other Holders;
(b) Notwithstanding Section 9.02(a), without the consent of each
Holder affected, no amendment, supplement or waiver may (with respect to any
Notes held by a non-consenting Holder):
(1) reduce the principal amount of Notes whose holders must consent
to an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of any Note
or alter the provisions with respect to the redemption of the Notes (it
being understood that this clause (2) does not apply to Sections 4.09 and
4.13);
(3) reduce the rate of or change the time for payment of interest on
any Note;
(4) waive a Default or Event of Default in the payment of principal
of, or interest or premium, or Special Interest, if any, on the Notes
(except a rescission of acceleration of the Notes by the holders of at
least a majority in aggregate principal amount of the then outstanding
Notes in accordance with the provisions of this Indenture and a waiver of
the payment default that resulted from such acceleration);
(5) make any Note payable in money other than that stated in the
Notes;
(6) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders to receive payments of
principal of, or interest or premium or Special Interest, if any, on the
Notes;
(7) waive a redemption payment with respect to any Note (it being
understood that this clause (7) does not apply to a payment required by
Sections 4.09 or 4.13);
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(8) release Holdings or any other Guarantor that is a Significant
Subsidiary from any of its obligations under its Guarantee or this
Indenture, except in accordance with the terms of this Indenture;
(9) in the event that the obligation to make a Change of Control
Offer or an Asset Sale Offer has arisen, amend, change or modify in any
material respect the obligation of the Issuer to make and consummate such
Change of Control Offer or such Asset Sale Offer, as the case may be;
(10) modify or change any provision of this Indenture or the related
definitions affecting the subordination of the Notes or any Guarantee in a
manner that adversely affects the Holders; or
(11) make any change in these amendment and waiver provisions.
(c) It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment,
supplement or waiver but it shall be sufficient if such consent approves the
substance thereof.
(d) A consent to any amendment, supplement or waiver under this
Indenture by any Holder given in connection with an exchange (in the case of an
exchange offer) or a tender (in the case of a tender offer) of such Holder's
Notes shall not be rendered invalid by such tender or exchange.
(e) After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Issuer shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Issuer to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amendment, supplement or
waiver.
SECTION 9.03. Effect on Senior Debt.
No amendment of, or supplement or waiver to, this Indenture shall
adversely affect the rights of any holder of Senior Debt under Article Ten and
Section 11.02 and the defined terms as used therein without the consent of such
holder or its Representative or, in accordance with the terms of such Senior
Debt, the consent of the agent or representative of such Holder or the requisite
holders of such Senior Debt or Designated Senior Debt.
SECTION 9.04. Compliance with the Trust Indenture Act.
From the date on which this Indenture is qualified under the Trust
Indenture Act, every amendment, waiver or supplement of this Indenture, the
Notes or the Note Guarantees shall comply with the Trust Indenture Act as then
in effect.
SECTION 9.05. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a
consent to it by a Holder is a continuing consent by the Holder and every
subsequent Holder of a Note or portion
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of a Note that evidences the same debt as the consenting Holder's Note, even if
notation of the consent is not made on any Note. However, any such Holder or
subsequent Holder may revoke the consent as to his Note or portion of his Note
by notice to the Trustee or the Issuer received before the date on which the
Trustee receives an Officers' Certificate certifying that the Holders of the
requisite principal amount of Notes have consented (and not theretofore revoked
such consent) to the amendment, supplement or waiver.
The Issuer may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which record date shall be prior to the first solicitation
of such consent. If a record date is fixed, then notwithstanding the last
sentence of the immediately preceding paragraph, those Persons who were Holders
at such record date (or their duly designated proxies), and only those Persons,
shall be entitled to revoke any consent previously given, whether or not such
Persons continue to be Holders after such record date. No such consent shall be
valid or effective for more than 120 days after such record date. The Issuer
shall inform the Trustee in writing of the fixed record date if applicable.
After an amendment, supplement or waiver becomes effective, it shall
bind every Holder, unless it makes a change described in any of clauses (1)
through (11) of Section 9.02(b), in which case, the amendment, supplement or
waiver shall bind only each Holder of a Note who has consented to it and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note; provided that any such waiver shall not impair or
affect the right of any Holder to receive payment of principal of, and interest
on, a Note, on or after the respective due dates therefor, or to bring suit for
the enforcement of any such payment on or after such respective dates without
the consent of such Holder.
SECTION 9.06. Notation on or Exchange of Notes.
If an amendment, supplement or waiver changes the terms of a Note,
the Issuer may require the Holder to deliver it to the Trustee. The Issuer shall
provide the Trustee with an appropriate notation on the Note about the changed
terms and cause the Trustee to return it to the Holder at the Issuer's expense.
Alternatively, if the Issuer or the Trustee so determines, the Issuer in
exchange for the Note shall issue, and the Trustee shall authenticate, a new
Note that reflects the changed terms. Failure to make the appropriate notation
or issue a new Note shall not affect the validity and effect of such amendment,
supplement or waiver.
SECTION 9.07. Trustee To Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article Nine; provided that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel and an Officers' Certificate
each stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or permitted by this
Indenture. Such Opinion of Counsel shall be at the expense of the Issuer.
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ARTICLE TEN
SUBORDINATION OF NOTES
SECTION 10.01. Notes Subordinated to Senior Debt.
Anything herein to the contrary notwithstanding, each of the Issuer,
for itself and its successors, and each Holder, by his or her acceptance of
Notes, agrees that the payment of all Obligations owing to the Holders in
respect of the Notes is subordinated, to the extent and in the manner provided
in this Article Ten, to the prior payment in full of all Senior Debt in cash or
cash equivalents, whether outstanding on the Issue Date or thereafter incurred.
Notwithstanding anything in this Article Ten to the contrary, payments and
distributions (A) of Permitted Junior Securities and (B) made relating to the
Notes from the trusts established pursuant to Article Eight shall not be so
subordinated in right of payment, so long as, with respect to (B), (i) the
conditions specified in Article Eight (without any waiver or modification of the
requirement that the deposits pursuant thereto do not conflict with the terms of
the Credit Facilities or any other Senior Debt) are satisfied on the date of any
deposit pursuant to said trust and (ii) such payments and distributions did not
violate the provisions of this Article Ten or Section 11.02 when made.
This Article Ten shall constitute a continuing offer to all Persons
who become Holders of, or continue to hold, Senior Debt, such provisions are
made for the benefit of the Holders of Senior Debt and such Holders are made
obligees hereunder and any one or more of them may enforce such provisions.
SECTION 10.02. Suspension of Payment When Senior Debt Is in Default.
(a) If any default occurs and is continuing beyond the applicable
grace period, if any, in the payment when due, whether at maturity, upon any
redemption, by declaration or otherwise, of any principal of, interest on,
unpaid drawings for letters of credit issued in respect of, or fees with respect
to, any Senior Debt (for purposes of this Article X only, a "PAYMENT DEFAULT"),
then no payment or distribution of any kind or character shall be made by the
Issuer with respect to any Obligations on or relating to the Notes or to acquire
any of the Notes for cash or assets or otherwise.
(b) If any other event of default (other than a Payment Default)
occurs and is continuing with respect to any Designated Senior Debt (as such
event of default is defined in the instrument creating or evidencing such
Designated Senior Debt) permitting the Holders of such Designated Senior Debt
then outstanding to accelerate the maturity thereof (a "NON-PAYMENT DEFAULT")
and if the Representative for the respective issue of Designated Senior Debt
gives written notice of the Non-Payment Default to the Trustee stating that such
notice is a payment blockage notice (a "PAYMENT BLOCKAGE NOTICE"), then during
the period (the "PAYMENT BLOCKAGE PERIOD") beginning upon the delivery of such
Payment Blockage Notice and ending on the earliest of (1) the date on which all
such nonpayment defaults are cured or waived, (2) 179 days after the date on
which the applicable Payment Blockage Notice is received or (3) the date on
which the Trustee receives notice from the Representative for such Designated
Senior Debt rescinding the Payment Blockage Notice (unless the maturity of any
Designated Senior Debt has been accelerated), the Issuer shall not (x) make any
payment of any kind or character with
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respect to any Obligations on or with respect to the Notes or (y) acquire any of
the Notes for cash or assets or otherwise. Notwithstanding anything herein to
the contrary, (x) in no event shall a Payment Blockage Period extend beyond 179
days from the date the applicable Payment Blockage Notice is received by the
Trustee and (y) no new Payment Blockage Notice may be delivered unless and until
360 days have elapsed since the effectiveness of the immediately prior Payment
Blockage Notice. For all purposes of this Section 10.02(b), no Non-Payment
Default which existed or was continuing on the date of the commencement of any
Payment Blockage Period with respect to the Designated Senior Debt shall be, or
be made, the basis for the commencement of a subsequent Payment Blockage Period
by the Representative of such Designated Senior Debt whether or not within a
period of 360 consecutive days, unless such Non-Payment Default shall have been
cured or waived for a period of not less than 90 consecutive days. Any
subsequent action, or any breach of any financial covenants for a period ending
after the date of delivery of such Payment Blockage Notice that, in either case,
would give rise to a Non-Payment Default pursuant to any provisions under which
a Non-Payment Default previously existed or was continuing shall constitute a
new Non-Payment Default for this purpose.
(c) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder when such payment is prohibited
by the foregoing provisions of this Section 10.02, such payment shall be held in
trust for the benefit of, and shall be paid over or delivered to, the holders of
Senior Debt (pro rata to such holders on the basis of the respective amount of
Senior Debt held by such Holders) or their respective Representatives, as their
respective interests may appear. The Trustee shall be entitled to rely on
information regarding amounts outstanding on the Senior Debt, if any, received
from the holders of the Senior Debt (or their Representatives).
Nothing contained in this Article Ten shall limit the right of the
Trustee or the Holders take any action to accelerate the maturity of the Notes
pursuant to Section 6.02 or to pursue any rights or remedies hereunder; provided
that all Senior Debt thereafter due or declared to be due shall first be paid in
full in cash or cash equivalents before the Holders are entitled to receive any
payment of any kind or character with respect to Obligations on the Notes.
SECTION 10.03. Notes Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of the Issuer.
(a) Upon any payment or distribution of assets of the Issuer of any
kind or character, whether in cash, assets or securities, to creditors upon any
total or partial liquidation, dissolution, winding-up, assignment for the
benefit of creditors or marshaling of assets and liabilities of the Issuer or in
a bankruptcy, reorganization, insolvency, receivership or other similar
proceeding relating to the Issuer or its assets, whether voluntary or
involuntary, all Obligations due or to become due on all Senior Debt shall first
be paid in full in cash or cash equivalents, or such payment duly provided for
to the satisfaction of the holders of Senior Debt, before any payment or
distribution of any kind or character is made on account of any Obligations on
or relating to the Notes, or for the acquisition of any of the Notes for cash or
assets or otherwise. Upon any such dissolution, winding-up, liquidation,
reorganization, receivership or similar proceeding, any payment or distribution
of assets of the Issuer of any kind or character, whether in cash, assets or
securities, to which the Holders or the Trustee under this
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Indenture would be entitled, except for the provisions hereof, shall be paid by
the Issuer or by any receiver, trustee in bankruptcy, liquidating trustee, agent
or other Person making such payment or distribution, or by the Holders or by the
Trustee under this Indenture if received by them, directly to the holders of
Senior Debt (pro rata to such holders on the basis of the respective amounts of
Senior Debt held by such holders) or their respective Representatives, or to the
Trustee or trustees under any indenture pursuant to which any of such Senior
Debt may have been issued, as their respective interests may appear, for
application to the payment of Senior Debt remaining unpaid until all such Senior
Debt has been paid in full in cash or cash equivalents after giving effect to
any concurrent payment, distribution or provision therefor to or for the holders
of Senior Debt.
(b) To the extent any payment of Senior Debt (whether by or on
behalf of the Issuer, as proceeds of security or enforcement of any right of
setoff or otherwise) is declared to be fraudulent or preferential, set aside or
required to be paid to any receiver, trustee in bankruptcy, liquidating trustee,
agent or other similar Person under any bankruptcy, insolvency, receivership,
fraudulent conveyance or similar law, then, if such payment is recovered by, or
paid over to, such receiver, trustee in bankruptcy, liquidating trustee, agent
or other similar Person, the Senior Debt or part thereof originally intended to
be satisfied shall be for purpose of this Article Ten deemed to be reinstated
and outstanding as if such payment had not occurred.
It is further agreed that any diminution (whether pursuant to court
decree or otherwise, including without limitation for any of the reasons
described in the preceding sentence) of the Issuer's obligation to make any
distribution or payment pursuant to any Senior Debt, except to the extent such
diminution occurs by reason of the repayment (which has not been disgorged or
returned) of such Senior Debt in cash or cash equivalents, shall have no force
or effect for purposes of the subordination provisions contained in this Article
Ten, with any turnover of payments as otherwise calculated pursuant to this
Article Ten to be made as if no such diminution had occurred.
(c) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Issuer of any kind or character, whether in cash,
assets or securities, shall be received by any Holder when such payment or
distribution is prohibited by this Section 10.03, such payment or distribution
shall be held in trust for the benefit of, and shall be paid over or delivered
to, the holders of Senior Debt (pro rata to such holders on the basis of the
respective amount of Senior Debt held by such holders) or their respective
Representatives, or to the Trustee or trustees under any indenture pursuant to
which any of such Senior Debt may have been issued, as their respective
interests may appear, for application to the payment of Senior Debt remaining
unpaid until all such Senior Debt has been paid in full in cash or cash
equivalents, after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of such Senior Debt.
(d) The consolidation of the Issuer with, or the merger of the
Issuer with or into, another Person or the liquidation or dissolution of the
Issuer following the conveyance or transfer of all or substantially all of its
assets, to another Person upon the terms and conditions provided in Article Five
hereof shall not be deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section if such other Person shall, as a
part of such
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consolidation, merger, conveyance or transfer, assume the Issuer's obligations
hereunder in accordance with Article Five hereof.
SECTION 10.04. Payments May Be Made on Notes.
Nothing contained in this Article Ten or elsewhere in this Indenture
shall prevent (i) the Issuer, except under the conditions described in Sections
10.02 and 10.03, from making payments at any time for the purpose of making
payments of principal of, and interest on, the Notes, or from depositing with
the Trustee any moneys for such payments, or (ii) in the absence of actual
knowledge by the Trustee that a given payment would be prohibited by Section
10.02 or 10.03, the application by the Trustee of any moneys deposited with it
for the purpose of making such payments of principal of, and interest on, the
Notes to the Holders entitled thereto unless at least two Business Days prior to
the date upon which such payment would otherwise become due and payable a
Responsible Officer of the Trustee shall have actually received the written
notice provided for in the first sentence of Section 10.02(b) or in Section
10.07 (provided that, notwithstanding the foregoing, the Holders receiving any
payments made in contravention of Section 10.02 and/or 10.03 (and the respective
such payments) shall otherwise be subject to the provisions of Section 10.02 and
Section 10.03). Notwithstanding anything to the contrary contained in this
Article Ten or elsewhere in this Indenture, payments and distributions from the
funds deposited pursuant to Article Eight shall be permitted to be made and
shall not be subject to the provisions of this Article Ten so long as such funds
were deposited in accordance with the provisions of Article Eight and did not
violate the provisions of this Article Ten when such funds were so deposited.
The Issuer shall give prompt written notice to the Trustee of any dissolution,
winding-up, liquidation or reorganization of the Issuer, although any delay or
failure to give any such notice shall have no effect on the subordination
provisions contained herein.
SECTION 10.05. Holders To Be Subrogated to Rights of Holders of Senior Debt.
Subject to the payment in full of all Senior Debt in cash or cash
equivalents, the Holders shall be subrogated to the rights of the holders of
Senior Debt to receive payments or distributions of cash, assets or securities
of the Issuer applicable to the Senior Debt until the Notes shall be paid in
full; and, for the purposes of such subrogation, no such payments or
distributions to the holders of the Senior Debt by or on behalf of the Issuer,
or by or on behalf of the Holders by virtue of this Article Ten, which otherwise
would have been made to the Holders shall, as between the Issuer and the
Holders, be deemed to be a payment by the Issuer to or on account of the Senior
Debt, it being understood that the provisions of this Article Ten are and are
intended solely for the purpose of defining the relative rights of the Holders,
on the one hand, and the holders of Senior Debt, on the other hand.
SECTION 10.06. Obligations of the Issuer Unconditional.
Nothing contained in this Article Ten or elsewhere in this Indenture
or in the Notes is intended to or shall impair, as between the Issuer, and the
Holders, the obligation of the Issuer, which is absolute and unconditional, to
pay to the Holders the principal of, and any interest on, the Notes as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
the Issuer other than the holders of the Senior Debt, nor shall anything herein
or therein prevent the
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Holder of any Note or the Trustee on its behalf from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, of the holders of Senior Debt in respect of cash, assets
or securities of the Issuer received upon the exercise of any such remedy.
SECTION 10.07. Notice to Trustee.
The Issuer shall give prompt written notice to the Trustee of any
fact known to the Issuer which would prohibit the making of any payment to or by
the Trustee in respect of the Notes pursuant to the provisions of this Article
Ten, although any delay or failure to give any such notice shall have no effect
on the subordination provisions contained herein. Regardless of anything to the
contrary contained in this Article Ten or elsewhere in this Indenture, the
Trustee shall not be charged with knowledge of the existence of any default or
event of default with respect to any Senior Debt or of any other facts which
would prohibit the making of any payment to or by the Trustee unless and until
the Trustee shall have received notice in writing from the Issuer, or from a
holder of Senior Debt or a Representative therefor and, prior to the receipt of
any such written notice, the Trustee shall be entitled to assume (in the absence
of actual knowledge to the contrary) that no such facts exist. The Trustee shall
be entitled to rely on the delivery to it of any notice pursuant to this Section
10.07 to establish that such notice has been given by a holder of Senior Debt
(or a Representative thereof).
In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Senior Debt to participate in any payment or distribution pursuant to this
Article Ten, the Trustee may request such Person to furnish evidence to the
satisfaction of the Trustee as to the amounts of Senior Debt held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Ten, and if such evidence is not furnished the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.
SECTION 10.08. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of the Issuer referred to
in this Article Ten, the Trustee, subject to the provisions of Article Seven
hereof, and the Holders shall be entitled to rely upon any order or decree made
by any court of competent jurisdiction in which any insolvency, bankruptcy,
receivership, dissolution, winding-up, liquidation, reorganization or similar
case or proceeding is pending, or upon a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, assignee for the benefit of creditors, agent or
other person making such payment or distribution, delivered to the Trustee or
the Holders, for the purpose of ascertaining the persons entitled to participate
in such payment or distribution, the holders of the Senior Debt and other
Indebtedness of the Issuer, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article Ten.
SECTION 10.09. Trustee's Relation to Senior Debt.
The Trustee and any agent of the Issuer or the Trustee shall be
entitled to all the rights set forth in this Article Ten with respect to any
Senior Debt which may at any time be held
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by it in its individual or any other capacity to the same extent as any other
holder of Senior Debt and nothing in this Indenture shall deprive the Trustee or
any such agent of any of its rights as such holder.
With respect to the holders of Senior Debt, the Trustee undertakes
to perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article Ten, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt.
Whenever a distribution is to be made or a notice given to holders
or owners of Senior Debt, the distribution may be made and the notice may be
given to their Representative, if any.
SECTION 10.10. Subordination Rights Not Impaired by Acts or Omissions of the
Issuer or Holders of Senior Debt.
No right of any present or future holders of any Senior Debt to
enforce subordination as provided herein shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Issuer or
by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Issuer with the terms of this Indenture, regardless of any
knowledge thereof, which any such holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Debt may, at any time and from time to time,
without the consent of or notice to the Trustee, without incurring
responsibility to the Trustee or the Holders and without impairing or releasing
the subordination provided in this Article Ten or the obligations hereunder of
the Holders to the holders of the Senior Debt, do any one or more of the
following: (i) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, Senior Debt, or otherwise amend or supplement
in any manner Senior Debt, or any instrument evidencing the same or any
agreement under which Senior Debt is outstanding; (ii) sell, exchange, release
or otherwise deal with any property pledged, mortgaged or otherwise securing
Senior Debt; (iii) release any Person liable in any manner for the payment or
collection of Senior Debt; and (iv) exercise or refrain from exercising any
rights against the Issuer and any other Person.
SECTION 10.11. Holders Authorize Trustee To Effectuate Subordination of Notes.
Each Holder by its acceptance of them authorizes and expressly
directs the Trustee on its behalf to take such action as may be necessary or
appropriate to effectuate, as between the holders of Senior Debt and the
Holders, the subordination provided in this Article Ten, and appoints the
Trustee its attorney-in-fact for such purposes, including, in the event of any
dissolution, winding-up, liquidation or reorganization of the Issuer (whether in
bankruptcy, insolvency, receivership, reorganization or similar proceedings or
upon an assignment for the benefit of credits or otherwise) tending towards
liquidation of the business and assets of the Issuer, the filing of a claim for
the unpaid balance of its Notes and accrued interest in the form required in
those proceedings.
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If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the holders of the Senior Debt or their
Representative are or is hereby authorized to have the right to file and are or
is hereby authorized to file an appropriate claim for and on behalf of the
Holders of said Notes. Nothing herein contained shall be deemed to authorize the
Trustee or the holders of Senior Debt or their Representative to authorize,
consent to, accept or adopt on behalf of any Holder any plan of reorganization,
arrangement, adjustment or composition affecting the Notes or the rights of any
Holder thereof, or to authorize the Trustee or the holders of Senior Debt or
their Representative to vote in respect of the claim of any Holder in any such
proceeding.
SECTION 10.12. This Article Ten Not To Prevent Events of Default.
The failure to make a payment on account of principal of, or
interest on, the Notes by reason of any provision of this Article Ten shall not
be construed as preventing the occurrence of an Event of Default.
SECTION 10.13. Trustee's Compensation Not Prejudiced.
Nothing in this Article Ten shall apply to amounts due to the
Trustee (other than payments of Obligations owing to Holders in respect of the
Notes) pursuant to other Sections of this Indenture.
ARTICLE ELEVEN
NOTE GUARANTEE
SECTION 11.01. Unconditional Guarantee.
Subject to the provisions of this Article Eleven, each of the
Guarantors hereby, jointly and severally, unconditionally and irrevocably
guarantees to each Holder of a Note authenticated and delivered by the Trustee
and to the Trustee and its successors and assigns, irrespective of the validity
and enforceability of this Indenture, the Notes or the obligations of the Issuer
or any other Guarantors to the Holders or the Trustee hereunder or thereunder:
(a) (x) the due and punctual payment of the principal of, premium, if any, and
interest on the Notes when and as the same shall become due and payable, whether
at maturity, upon redemption or repurchase, by acceleration or otherwise, (y)
the due and punctual payment of interest on the overdue principal and (to the
extent permitted by law) interest, if any, on the Notes and (z) the due and
punctual payment and performance of all other obligations of the Issuer and all
other obligations of the other Guarantors (including under the Note Guarantees),
in each case, to the Holders or the Trustee hereunder or thereunder (including
amounts due the Trustee under Section 7.07), all in accordance with the terms
hereof and thereof (collectively, the "GUARANTEE OBLIGATIONS"); and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, the due and punctual payment and performance of Guarantee
Obligations in accordance with the terms of the extension or renewal, whether at
maturity, upon redemption or repurchase, by acceleration or otherwise. Failing
payment when due of any amount so guaranteed, or failing performance of any
other obligation of the Issuer to the Holders under this Indenture or under the
Notes, for whatever reason, each Guarantor shall be obligated
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to pay, or to perform or cause the performance of, the same immediately. An
Event of Default under this Indenture or the Notes shall constitute an event of
default under the Note Guarantees, and shall entitle the Holders to accelerate
the obligations of the Guarantors thereunder in the same manner and to the same
extent as the obligations of the Issuer.
Each of the Guarantors hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder with respect to any
provisions hereof or thereof, any release of any other Guarantor, the recovery
of any judgment against the Issuer, any action to enforce the same, whether or
not a Note Guarantee is affixed to any particular Note, or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor (other than payment). To the fullest extent permitted by
law and subject to Section 6.06, each of the Guarantors hereby waives the
benefit of diligence, presentment, demand of payment, filing of claims with a
court in the event of insolvency or bankruptcy of the Issuer, any right to
require a proceeding first against the Issuer, protest, notice and all demands
whatsoever and covenants that its Note Guarantee shall not be discharged except
by complete performance of the obligations contained in the Notes, this
Indenture and this Note Guarantee. This Note Guarantee is a guarantee of payment
and not of collection. If any Holder or the Trustee is required by any court or
otherwise to return to the Issuer or to any Guarantor, or any custodian,
Trustee, liquidator or other similar official acting in relation to the Issuer
or such Guarantor, any amount paid by the Issuer or such Guarantor to the
Trustee or such Holder, this Note Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect. Each Guarantor further
agrees that, as between it, on the one hand, and the Holders and the Trustee, on
the other hand, (a) subject to this Article Eleven, the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article Six for
the purposes of this Note Guarantee, notwithstanding any stay, injunction or
other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (b) in the event of any acceleration of such obligations
as provided in Article Six, such obligations (whether or not due and payable)
shall forthwith become due and payable by the Guarantors for the purpose of this
Note Guarantee.
SECTION 11.02. Subordination of Note Guarantee.
The obligations of each Guarantor under its Note Guarantee pursuant
to this Article Eleven shall be junior and subordinated to the prior payment in
full of the Senior Debt of such Guarantor in cash or cash equivalents on the
same basis as the Notes are junior and subordinated to Senior Debt of the
Issuer. For the purposes of the foregoing sentence, the Trustee and the Holders
shall have the right to receive and/or retain payments by any of the Guarantors
only at such times as they may receive and/or retain payments in respect of the
Notes pursuant to this Indenture, including Article Ten.
SECTION 11.03. Limitation on Guarantor Liability.
Each Subsidiary Guarantor, and by its acceptance of Notes,
each Holder, hereby confirms that it is the intention of all such parties that
the Note Guarantee of such Guarantor not constitute a fraudulent transfer or
conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar federal,
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foreign, provincial or state law to the extent applicable to any Note Guarantee.
To effectuate the foregoing intention, the Trustee, the Holders and the
Subsidiary Guarantors hereby irrevocably agree (to the extent required by such
laws) that the obligations of such Guarantor under its Note Guarantee and this
Article Eleven shall be limited to the maximum amount as will, after giving
effect to all other contingent and fixed liabilities of such Guarantor
(including any guarantee under the Credit Agreement) that are relevant under
such laws, and after giving effect to any collections from, rights to receive
contribution from or payments made by or on behalf of any other Subsidiary
Guarantor in respect of the obligations of such other Guarantor under this
Article Eleven, result in the obligations of such Guarantor under its Note
Guarantee not constituting a fraudulent transfer or conveyance. Each Subsidiary
Guarantor that makes a payment for distribution under its Note Guarantee is
entitled to a contribution from each other Subsidiary Guarantor in a pro rata
amount based on the adjusted net assets of each Subsidiary Guarantor.
SECTION 11.04. Execution and Delivery of Note Guarantee.
To further evidence its Note Guarantee set forth in Section 11.01,
each Guarantor hereby agrees that a notation of such Note Guarantee,
substantially in the form of Exhibit F hereto, shall be endorsed on each Note
authenticated and delivered by the Trustee. Such Note Guarantee shall be
executed on behalf of each Guarantor by either manual or facsimile signature of
one Officer or other person duly authorized by all necessary corporate action of
each Guarantor who shall have been duly authorized to so execute by all
requisite corporate action. The validity and enforceability of any Note
Guarantee shall not be affected by the fact that it is not affixed to any
particular Note.
Each of the Guarantors hereby agrees that its Note Guarantee set
forth in Section 11.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
If an Officer of a Guarantor whose signature is on this Indenture or
a Note Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which such Note Guarantee is endorsed or at any time
thereafter, such Guarantor's Note Guarantee of such Note shall nevertheless be
valid.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Note Guarantee set forth
in this Indenture on behalf of each Guarantor.
SECTION 11.05. Release of a Subsidiary Guarantor.
Notwithstanding Section 4.16(a), a Subsidiary Guarantor shall be
automatically and unconditionally released from its obligations under its Note
Guarantee and its obligations under this Indenture and the Registration Rights
Agreement in accordance with Section 4.16(c).
The Trustee shall execute an appropriate instrument prepared by the
Issuer evidencing the release of a Guarantor from its obligations under its Note
Guarantee upon receipt of a request by the Issuer or such Guarantor accompanied
by an Officers' Certificate and an Opinion of Counsel certifying as to the
compliance with this Section 11.05; provided, however,
95
that the legal counsel delivering such Opinion of Counsel may rely as to matters
of fact on one or more Officers' Certificates of the Issuer.
Except as set forth in Articles Four and Five and this Section
11.05, nothing contained in this Indenture or in any of the Notes shall prevent
any consolidation or merger of a Guarantor with or into the Issuer or another
Guarantor or shall prevent any sale or conveyance of the property of a Guarantor
as an entirety or substantially as an entirety to the Issuer or another
Guarantor.
SECTION 11.06. Waiver of Subrogation.
Until this Indenture is discharged and all of the Notes are
discharged and paid in full, each Guarantor hereby irrevocably waives and agrees
not to exercise any claim or other rights which it may now or hereafter acquire
against the Issuer that arise from the existence, payment, performance or
enforcement of the Issuer's obligations under the Notes or this Indenture and
such Guarantor's obligations under this Note Guarantee and this Indenture, in
any such instance including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution, indemnification, and any right to
participate in any claim or remedy of the Holders against the Issuer, whether or
not such claim, remedy or right arises in equity, or under contract, statute or
common law, including, without limitation, the right to take or receive from the
Issuer, directly or indirectly, in cash or other assets or by set-off or in any
other manner, payment or security on account of such claim or other rights. If
any amount shall be paid to any Guarantor in violation of the preceding sentence
and any amounts owing to the Trustee or the Holders under the Notes, this
Indenture, or any other document or instrument delivered under or in connection
with such agreements or instruments, shall not have been paid in full, such
amount shall have been deemed to have been paid to such Guarantor for the
benefit of, and held in trust for the benefit of, the Trustee or the Holders and
shall forthwith be paid to the Trustee for the benefit of itself or such Holders
to be credited and applied to the obligations in favor of the Trustee or the
Holders, as the case may be, whether matured or unmatured, in accordance with
the terms of this Indenture. Each Guarantor acknowledges that it shall receive
direct and indirect benefits from the financing arrangements contemplated by
this Indenture and that the waiver set forth in this Section 11.06 is knowingly
made in contemplation of such benefits.
SECTION 11.07. Immediate Payment.
Each Guarantor agrees to make immediate payment to the Trustee on
behalf of the Holders of all Guarantee Obligations owing or payable to the
respective Holders upon receipt of a demand for payment therefor by the Trustee
to such Guarantor in writing.
SECTION 11.08. No Set-Off.
Each payment to be made by a Guarantor hereunder in respect of the
Guarantee Obligations shall be payable in the currency or currencies in which
such Guarantee Obligations are denominated, and, to the fullest extent permitted
by law, shall be made without set-off, counterclaim, reduction or diminution of
any kind or nature.
96
SECTION 11.09. Guarantee Obligations Absolute.
The obligations of each Guarantor hereunder are and shall be
absolute and unconditional and any monies or amounts expressed to be owing or
payable by each Guarantor hereunder which may not be recoverable from such
Guarantor on the basis of a Note Guarantee shall be recoverable from such
Guarantor as a primary obligor and principal debtor in respect thereof.
SECTION 11.10. Note Guarantee Obligations Continuing.
The obligations of each Guarantor hereunder shall be continuing and
shall remain in full force and effect until all such obligations have been paid
and satisfied in full. Each Guarantor agrees with the Trustee that it shall from
time to time deliver to the Trustee suitable acknowledgments of this continued
liability hereunder and under any other instrument or instruments in such form
as counsel to the Trustee may advise and as shall prevent any action brought
against it in respect of any default hereunder being barred by any statute of
limitations now or hereafter in force and, in the event of the failure of a
Guarantor so to do, it hereby irrevocably appoints the Trustee the attorney and
agent of such Guarantor to make, execute and deliver such written acknowledgment
or acknowledgments or other instruments as may from time to time become
necessary or advisable, in the judgment of the Trustee on the advice of counsel,
to fully maintain and keep in force the liability of such Guarantor hereunder.
SECTION 11.11. Note Guarantee Obligations Not Reduced.
The obligations of each Guarantor hereunder shall not be satisfied,
reduced or discharged solely by the payment of such principal, premium, if any,
interest, fees and other monies or amounts as may at any time prior to discharge
of this Indenture pursuant to Article Eight be or become owing or payable under
or by virtue of or otherwise in connection with the Notes or this Indenture.
SECTION 11.12. Note Guarantee Obligations Reinstated.
The obligations of each Guarantor hereunder shall continue to be
effective or shall be reinstated, as the case may be, if at any time any payment
which would otherwise have reduced the obligations of any Guarantor hereunder
(whether such payment shall have been made by or on behalf of the Issuer or by
or on behalf of a Guarantor) is rescinded or reclaimed from any of the Holders
upon the insolvency, bankruptcy, liquidation or reorganization of the Issuer or
any Guarantor or otherwise, all as though such payment had not been made. If
demand for, or acceleration of the time for, payment by the Issuer or any other
Guarantor is stayed upon the insolvency, bankruptcy, liquidation or
reorganization of the Issuer or such Guarantor, all such Indebtedness otherwise
subject to demand for payment or acceleration shall nonetheless be payable by
each Guarantor as provided herein.
SECTION 11.13. Note Guarantee Obligations Not Affected.
To the fullest extent permitted by law, the obligations of each
Guarantor hereunder shall not be affected, impaired or diminished in any way by
any act, omission, matter or thing whatsoever, occurring before, upon or after
any demand for payment hereunder (and
97
whether or not known or consented to by any Guarantor or any of the Holders)
which, but for this provision, might constitute a whole or partial defense to a
claim against any Guarantor hereunder or might operate to release or otherwise
exonerate any Guarantor from any of its obligations hereunder or otherwise
affect such obligations, whether occasioned by default of any of the Holders or
otherwise, including, without limitation:
(a) any limitation of status or power, disability, incapacity or
other circumstance relating to the Issuer or any other Person, including any
insolvency, bankruptcy, liquidation, reorganization, readjustment, composition,
dissolution, winding-up or other proceeding involving or affecting the Issuer or
any other Person;
(b) any irregularity, defect, unenforceability or invalidity in
respect of any indebtedness or other obligation of the Issuer or any other
Person under this Indenture, the Notes or any other document or instrument;
(c) any failure of the Issuer or any other Guarantor, whether or not
without fault on its part, to perform or comply with any of the provisions of
this Indenture, the Notes or any Note Guarantee, or to give notice thereof to a
Guarantor;
(d) the taking or enforcing or exercising or the refusal or neglect
to take or enforce or exercise any right or remedy from or against the Issuer or
any other Person or their respective assets or the release or discharge of any
such right or remedy;
(e) the granting of time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Issuer
or any other Person;
(f) any change in the time, manner or place of payment of, or in any
other term of, any of the Notes, or any other amendment, variation, supplement,
replacement or waiver of, or any consent to departure from, any of the Notes or
this Indenture, including, without limitation, any increase or decrease in the
principal amount of or premium, if any, or interest on any of the Notes;
(g) any change in the ownership, control, name, objects, businesses,
assets, capital structure or constitution of the Issuer or a Guarantor;
(h) any merger or amalgamation of the Issuer or a Guarantor with any
Person or Persons;
(i) the occurrence of any change in the laws, rules, regulations or
ordinances of any jurisdiction by any present or future action of any
governmental authority or court amending, varying, reducing or otherwise
affecting, or purporting to amend, vary, reduce or otherwise affect, any of the
Guarantee Obligations or the obligations of a Guarantor under its Note
Guarantee; and
(j) any other circumstance, including release of a Guarantor
pursuant to Section 11.05 (other than by complete, irrevocable payment) that
might otherwise constitute a legal or equitable discharge or defense of the
Issuer under this Indenture or the Notes or of a Guarantor in respect of its
Note Guarantee hereunder.
98
SECTION 11.14. Waiver.
Without in any way limiting the provisions of Section 11.01, each
Guarantor hereby waives notice of acceptance hereof, notice of any liability of
any Guarantor hereunder, notice or proof of reliance by the Holders upon the
obligations of any Guarantor hereunder, and diligence, presentment, demand for
payment on the Issuer, protest, notice of dishonor or non-payment of any of the
Guarantee Obligations, or other notice or formalities to the Issuer or any
Guarantor of any kind whatsoever.
SECTION 11.15. No Obligation to Take Action Against the Issuer.
Neither the Trustee nor any other Person shall have any obligation
to enforce or exhaust any rights or remedies against the Issuer or any other
Person or any property of the Issuer or any other Person before the Trustee is
entitled to demand payment and performance by any or all Guarantors of their
liabilities and obligations under their Note Guarantees or under this Indenture.
SECTION 11.16. Dealing with the Issuer and Others.
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Guarantor
hereunder and without the consent of or notice to any Guarantor, may
(a) grant time, renewals, extensions, compromises, concessions,
waivers, releases, discharges and other indulgences to the Issuer or any other
Person;
(b) take or abstain from taking security or collateral from the
Issuer or from perfecting security or collateral of the Issuer;
(c) release, discharge, compromise, realize, enforce or otherwise
deal with or do any act or thing in respect of (with or without consideration)
any and all collateral, mortgages or other security given by the Issuer or any
third party with respect to the obligations or matters contemplated by this
Indenture or the Notes;
(d) accept compromises or arrangements from the Issuer;
(e) apply all monies at any time received from the Issuer or from
any security upon such part of the Guarantee Obligations as the Holders may see
fit or change any such application in whole or in part from time to time as the
Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to deal
with, the Issuer and all other Persons and any security as the Holders or the
Trustee may see fit.
SECTION 11.17. Default and Enforcement.
If any Guarantor fails to pay in accordance with Section 11.07
hereof, the Trustee may proceed in its name as trustee hereunder in the
enforcement of the Note Guarantee of any such Guarantor and such Guarantor's
obligations thereunder and hereunder by any remedy
99
provided by law, whether by legal proceedings or otherwise, and to recover from
such Guarantor the obligations.
SECTION 11.18. Acknowledgment.
Each Guarantor hereby acknowledges communication of the terms of
this Indenture and the Notes and consents to and approves of the same.
SECTION 11.19. Costs and Expenses.
Each Guarantor shall pay on demand by the Trustee any and all
reasonable costs, fees and expenses (including, without limitation, reasonable
legal fees on a solicitor and client basis) incurred by the Trustee, its agents,
advisors and counsel or any of the Holders in enforcing any of their rights
under any Note Guarantee.
SECTION 11.20. No Merger or Waiver; Cumulative Remedies.
No Note Guarantee shall operate by way of merger of any of the
obligations of a Guarantor under any other agreement, including, without
limitation, this Indenture. No failure to exercise and no delay in exercising,
on the part of the Trustee or the Holders, any right, remedy, power or privilege
hereunder or under this Indenture or the Notes, shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder or under this Indenture or the Notes preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges in the Note Guarantee and
under this Indenture, the Notes and any other document or instrument between a
Guarantor and/or the Issuer and the Trustee are cumulative and not exclusive of
any rights, remedies, powers and privilege provided by law.
SECTION 11.21. Survival of Note Guarantee Obligations.
Without prejudice to the survival of any of the other obligations of
each Guarantor hereunder, the obligations of each Guarantor under Section 11.01
shall survive the payment in full of the Guarantee Obligations and shall be
enforceable against such Guarantor, to the fullest extent permitted by law,
without regard to and without giving effect to any defense, right of offset or
counterclaim available to or which may be asserted by the Issuer or any
Guarantor.
SECTION 11.22. Note Guarantee in Addition to Other Guarantee Obligations.
The obligations of each Guarantor under its Note Guarantee and this
Indenture are in addition to and not in substitution for any other obligations
to the Trustee or to any of the Holders in relation to this Indenture or the
Notes and any guarantees or security at any time held by or for the benefit of
any of them.
SECTION 11.23. Severability.
Any provision of this Article Eleven which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining provisions
and any such prohibition or
100
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction unless its removal would
substantially defeat the basic intent, spirit and purpose of this Indenture and
this Article Eleven.
SECTION 11.24. Successors and Assigns.
Each Note Guarantee shall be binding upon and inure to the benefit
of each Guarantor and the Trustee and the other Holders and their respective
successors and permitted assigns, except that no Guarantor may assign any of its
obligations hereunder or thereunder.
ARTICLE TWELVE
MISCELLANEOUS
SECTION 12.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies, or conflicts
with another provision which is required or deemed to be included in this
Indenture by the Trust Indenture Act, such required or deemed provision shall
control.
SECTION 12.02. Notices.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telex, by nationally recognized overnight courier service, by telecopier or
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:
if to the Issuer or a Guarantor:
c/o MAAX Corporation
000 Xxxxxxx Xxxx
Xxxxxx-Xxxxx, Xxxxxx X0X 0X0
Xxxxxx
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
X.X. Childs Associates L.P. 000
Xxxxxxxxxx Xxxxxx - Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Facsimile: (000) 000-0000
101
if to the Trustee:
U.S. Bank Trust National Association
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Corporate Trust Services
Telephone: 000-000-0000
Facsimile: 000-000-0000
Each of the Issuer and the Trustee by written notice to each other
such Person may designate additional or different addresses for notices to such
Person. Any notice or communication to the Issuer and the Trustee, shall be
deemed to have been given or made as of the date so delivered if personally
delivered; when replied to; when receipt is acknowledged, if telecopied; five
(5) calendar days after mailing if sent by registered or certified mail, postage
prepaid (except that a notice of change of address shall not be deemed to have
been given until actually received by the addressee); and next Business Day if
by nationally recognized overnight courier service.
Any notice or communication mailed to a Holder shall be mailed to
him by first class mail or other equivalent means at his address as it appears
on the registration books of the Registrar and shall be sufficiently given to
him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any defect
in it shall not affect its sufficiency with respect to other Holders. If a
notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
SECTION 12.03. Communications by Holders with Other Holders.
Holders may communicate pursuant to Trust Indenture Act Section
312(b) with other Holders with respect to their rights under this Indenture, the
Notes or the Note Guarantees. The Issuer, the Trustee, the Registrar and any
other Person shall have the protection of Trust Indenture Act Section 312(c).
SECTION 12.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Issuer to the Trustee to take
any action under this Indenture, the Issuer shall furnish to the Trustee at the
request of the Trustee:
(1) an Officers' Certificate, in form and substance reasonably
satisfactory to the Trustee, stating that, in the opinion of the signers,
all conditions precedent to be performed or effected by the Issuer, if
any, provided for in this Indenture relating to the proposed action have
been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
102
SECTION 12.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture, other than the Officers'
Certificate required by Section 4.06, shall include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with or satisfied; and
(4) a statement as to whether or not, in the opinion of each such
Person, such condition or covenant has been complied with; provided,
however, that with respect to matters of fact, an Opinion of Counsel may
rely on an Officers' Certificate or certificates of public officials.
SECTION 12.06. Rules by Paying Agent or Registrar.
The Paying Agent or Registrar may make reasonable rules and set reasonable
requirements for their functions.
SECTION 12.07. Legal Holidays.
If a payment date is not a Business Day, payment may be made on the next
succeeding day that is a Business Day.
SECTION 12.08. Governing Law.
THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 12.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of any of the Issuer or any of its Subsidiaries. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
SECTION 12.10. No Recourse Against Others.
No director, officer, employee, incorporator, member or (except as
prohibited by applicable law) shareholder of the Issuer or any Guarantor, as
such, shall have any liability for any obligations of the Issuer under the Notes
or this Indenture or of any Guarantor under its Note
103
Guarantee or this Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting a Note
waives and releases all such liability. Such waiver and release are part of the
consideration for issuance of the Notes.
SECTION 12.11. Successors.
All agreements of the Issuer and the Guarantors in this Indenture,
the Notes and the Note Guarantees shall bind their respective successors. All
agreements of the Trustee in this Indenture shall bind its successor.
SECTION 12.12. Duplicate Originals.
All parties may sign any number of copies of this Indenture. Each
signed copy or counterpart shall be an original, but all of them together shall
represent the same agreement.
SECTION 12.13. Severability.
To the extent permitted by applicable law, in case any one or more
of the provisions in this Indenture, in the Notes or in the Note Guarantees
shall be held invalid, illegal or unenforceable, in any respect for any reason,
the validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions shall not in any way be affected or
impaired thereby, it being intended that all of the provisions hereof shall be
enforceable to the full extent permitted by law.
SECTION 12.14. Agent for Service and Waiver of Immunities.
By the execution and delivery of this Indenture, the Issuer and each
Guarantor (i) acknowledge that they will designate and appoint within sixty days
of the Issue Date National Registered Agents, Inc. or another Person
satisfactory to the Trustee (the "Authorized Agent"), as their authorized agent
upon which process may be served in any suit or proceeding arising out of or
relating to this Indenture or the Notes that may be instituted in any federal or
state court in the State of New York or brought under federal or state
securities laws, and acknowledge that the Authorized Agent has accepted such
designation, (ii) submit to the jurisdiction of any such court in any such suit
or proceeding, and (iii) agree that service of process upon the Authorized Agent
and written notice of said service to the Issuer or any Guarantor in accordance
with Section 12.02 shall be deemed effective service of process upon the Issuer
or such Guarantor in any such suit or proceeding. The Issuer and each Guarantor
further agree to take any reasonable action, including the execution and filing
of any and all such documents and instruments, as may be necessary to continue
such designation and appointment of the Authorized Agent in full force and
effect so long as any of the Notes shall be outstanding; provided, however, that
the Issuer and each Guarantor may, by written notice to the Trustee, designate
such additional or alternative agent for service of process under this Section
12.14 that (i) maintains an office located in the Borough of Manhattan, City of
New York, in the State of New York, (ii) is either (x) counsel for the Issuer or
(y) a corporate service company which acts as agent for service of process for
other persons in the ordinary course of its business and (iii) agrees to act as
agent for service of process in accordance with this Section 12.14. Such written
notice shall identify the name of such agent for process and the address of the
office of such agent for process in the Borough of Manhattan, City of New York,
State of New York. Upon the written request of any Holder, the Trustee shall
104
deliver a copy of such notice to such Holder. Notwithstanding the foregoing,
there shall, at all times, be at least one agent for service of process for the
Issuer appointed and acting in accordance with this Section 12.14.
SECTION 12.15. Judgment Currency.
The Issuer and each Guarantor agree to indemnify each Holder and
each Person, if any, who controls any Holder within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act against any loss incurred
by such party as a result of any judgment or order being given or made against
the Issuer or any Guarantor for any United States dollar amount due under this
Indenture and such judgment or order being expressed and paid in a currency (the
"JUDGMENT CURRENCY") other than United States dollars and as a result of any
variation as between (i) the rate of exchange at which the United States dollar
amount is converted into the Judgment Currency for the purpose of such judgment
or order and (ii) the spot rate of exchange in The City of New York at which
such party on the date of payment of such judgment or order is able to purchase
United States dollars with the amount of the Judgment Currency actually received
by such party if such party had utilized such amount of Judgment Currency to
purchase United States dollars as promptly as practicable upon such party's
receipt thereof. The foregoing indemnity shall continue in full force and effect
notwithstanding any such judgment or order as aforesaid. The term "spot rate of
exchange" shall include any premiums and costs of exchange payable in connection
with the purchase of, or conversion into, United States dollars.
105
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed all as of the date first written above.
MAAX CORPORATION, as Issuer
By: /s/ Xxxxx X. Xxxx
-------------------------------------
Name: Xxxxx X. Xxxx
Title: Secretary
BEAUCELAND CORPORATION, as Guarantor
By: /s/ Xxxxx X. Xxxx
-------------------------------------
Name: Xxxxx X. Xxxx
Title: Secretary
4200217 CANADA INC., as a Guarantor
By: /s/ Xxxxx X. Xxxx
-------------------------------------
Name: Xxxxx X. Xxxx
Title: Secretary
MAAX HOLDING CO.
MAAX-KSD CORPORATION
PEARL BATHS, INC.
MAAX-HYDRO SWIRL MANUFACTURING CORP.
MAAX MIDWEST, INC.
MAAX SPAS (ARIZONA), INC.
XXXX PLASTICS COMPANY INC.
MAAX CANADA INC.
CUISINE EXPERT - C.E. CABINETS INC.
0000-0000 XXXXXX INC.
MAAX SPAS (ONTARIO) INC.
MAAX SPAS (B.C.) INC., each as a
Guarantor
By: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
Title: Director & Officer
S-1
MAAX LLC, as a Guarantor
By: /s/ Xxxxxx Xxxxx
-------------------------------------
Name: Xxxxxx Xxxxx
Title: Director & Officer
S-2
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Assistant Vice President
S-3
EXHIBIT A
[INSERT THE GLOBAL NOTE LEGEND, IF APPLICABLE PURSUANT TO THE PROVISIONS OF THE
INDENTURE]
[INSERT THE PRIVATE PLACEMENT LEGEND, IF APPLICABLE PURSUANT TO THE PROVISIONS
OF THE INDENTURE]
MAAX CORPORATION
9.75% Senior Subordinated Notes 2012
No. CUSIP No.
US$
MAAX CORPORATION, a Nova Scotia unlimited company (the "ISSUER"),
for value received promise to pay to ____________ or its registered assigns, the
principal sum of
[or such other amount as is provided in a schedule attached
hereto](a) on June 15, 2012.
Interest Payment Dates: June 15 and December 15, commencing December
15, 2004.
Record Dates: June 1 and December 1.
Reference is made to the further provisions of this Note contained
herein, which will for all purposes have the same effect as if set forth at this
place.
--------------
(a) This language should be included only if the Note is issued in global form.
A-1
IN WITNESS WHEREOF, the Issuer has caused this Note to be signed
manually or by facsimile by its duly authorized officer.
Dated:
MAAX CORPORATION, as Issuer
By:
-------------------------------------
Name:
Title:
A-2
FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 9.75% Senior Subordinated Notes due 2012
described in the within mentioned Indenture.
Dated:
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
By:
-------------------------------------
Authorized Signatory
A-3
(Reverse of Note)
9.75% Senior Subordinated Notes due 2012
Capitalized terms used herein shall have the meanings assigned to
them in the Indenture referred to below unless otherwise indicated.
SECTION 1. Interest. MAAX Corporation, a Nova Scotia unlimited
company (the "ISSUER"), promises to pay interest (including Special Interest, if
applicable) on the principal amount of this Note at 9.75% per annum from June 4,
2004 until maturity. The Issuer will pay interest semi-annually in arrears on
June 15 and December 15 of each year, or if any such day is not a Business Day,
on the next succeeding Business Day (each an "INTEREST PAYMENT DATE"),
commencing December 15, 2004. Interest on the Notes will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from the date of original issuance. The Issuer shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time on demand to the extent lawful
at the interest rate applicable to the Notes; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest shall be
computed on the basis of a 360 day year of twelve 30 day months. For the
purposes of disclosure under the Interest Act (Canada), the yearly rate of
interest which is equivalent to the rate payable under the Notes is the rate
payable multiplied by the actual number of days in the year and divided by 360.
SECTION 2. Method of Payment. The Issuer shall pay interest on the
Notes to the Persons who are registered Holders at the close of business on June
1 or December 1 next preceding the Interest Payment Date, even if such Notes are
canceled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to defaulted
interest. The Notes shall be issued in denominations of US$1,000 and integral
multiples thereof. The Issuer shall pay principal, premium, if any, and interest
on the Notes in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts ("U.S.
LEGAL TENDER"). Principal, premium, if any, interest and Special Interest, if
any, on the Notes will be payable at the office or agency of the Issuer
maintained for such purpose except that, at the option of the Issuer, the
payment of interest may be made by check mailed to the Holders at their
respective addresses set forth in the register of Holders; provided that for
Holders owning at least $5.0 million in principal amount of Notes that have
given wire transfer instructions to the Issuer at least ten Business Days prior
to the applicable payment date, the Issuer shall make all payments of principal,
premium and interest by wire transfer of immediately available funds to the
accounts specified by the Holders thereof. Until otherwise designated by the
Issuer, the Issuer's office or agency in New York shall be the office of the
Trustee maintained for such purpose.
SECTION 3. Paying Agent and Registrar. Initially, U.S. Bank Trust
National Association, the Trustee under the Indenture, shall act as Paying Agent
and Registrar. The Issuer may change any Paying Agent or Registrar without
notice to any Holder. Except as provided in the Indenture, Holdings or any of
its Subsidiaries may act in any such capacity.
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SECTION 4. Indenture and Subordination. The Issuer issued the Notes
under an Indenture dated as of June 4, 2004 ("INDENTURE") by and among the
Issuer, the Guarantors and the Trustee. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb)
(the "TRUST INDENTURE ACT"). The Notes are subject to all such terms, and
Holders are referred to the Indenture and the Trust Indenture Act for a
statement of such terms. The payment of the Notes shall, to the extent set forth
in the Indenture, be subordinated in right of payment to the prior payment in
full in cash or cash equivalents of all Senior Debt.
SECTION 5. Optional Redemption.
(a) On or after June 15, 2008 (the "FOURTH ANNIVERSARY"), the Issuer
may on any one or more occasions redeem all or a part of the Notes at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest and Special Interest, if any, on the Notes
redeemed to the applicable Redemption Date, if redeemed during the twelve-month
period beginning June 15 of the years indicated below, subject to the rights of
Holders on the relevant Record Date to receive interest on the relevant Interest
Payment Date:
YEAR PERCENTAGE
---- ----------
2008........................................... 104.875%
2009........................................... 102.438%
2010 and thereafter............................ 100.000%
(b)At any time prior to the Fourth Anniversary, the Issuer may on
any one or more occasions redeem all or a part of the Notes, at a redemption
price equal to 100% of the principal amount thereof plus the Applicable Premium,
plus accrued and unpaid interest and Special Interest, if any, on the Notes to
be redeemed to the date of redemption, subject to the right of Holders of record
on the relevant Record Date to receive interest due on the relevant Interest
Payment Date; provided that in the case of any redemption in part, at least 50%
of the aggregate principal amount of Notes issued under the Indenture (including
any Additional Notes) remains outstanding after giving effect to such
redemption.
SECTION 6. Redemption With Proceeds From Equity Offerings. At any
time prior to June 15, 2007, the Issuer may on any one or more occasions redeem
up to 35% of the aggregate principal amount of Notes issued under the Indenture
(including any Additional Notes) at a redemption price of 109.750% of the
principal amount, plus accrued and unpaid interest and Special Interest, if any,
on the Notes to be redeemed to the Redemption Date, with the net cash proceeds
of one or more Equity Offerings; provided that: (1) at least 65% of the
aggregate principal amount of Notes issued under the Indenture (including any
Additional Notes, but excluding Notes held by the Issuer or any of its
Affiliates) remains outstanding immediately after the occurrence of such
redemption; and (2) the redemption occurs within 90 days of the date of the
closing of such Equity Offering.
SECTION 7. Notice of Redemption. Notice of redemption shall be
mailed by first class mail at least 30 days but not more than 60 days before the
Redemption Date to each Holder to be redeemed at its registered address. Notes
in denominations larger than US$1,000 may be redeemed in part. If any Note is to
be redeemed in part only, the notice of redemption
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that relates to such Note shall state the portion of the principal amount
thereof to be redeemed. A new Note in principal amount equal to the unredeemed
portion thereof shall be issued in the name of the Holder thereof upon
cancellation of the original Note. On and after the Redemption Date interest
ceases to accrue on Notes or portions thereof called for redemption.
SECTION 8. Mandatory Redemption. For the avoidance of doubt, an
offer to purchase pursuant to Section 9 hereof shall not be deemed a redemption.
The Issuer shall not be required to make mandatory redemption or sinking fund
payments with respect to the Notes.
SECTION 9. Repurchase at Option of Holder. Upon the occurrence of a
Change of Control, and subject to certain conditions set forth in the Indenture,
the Issuer shall be required to offer to purchase all of the outstanding Notes
at a purchase price equal to 101% of the principal amount thereof, plus accrued
and unpaid interest and Special Interest, if any, thereon to the date of
repurchase.
The Issuer is, subject to certain conditions and exceptions,
obligated to make an offer to purchase Notes at 100% of their principal amount,
plus accrued and unpaid interest, if any, thereon to the date of repurchase,
with certain net cash proceeds of certain sales or other dispositions of assets
in accordance with the Indenture.
SECTION 10. Redemption for Changes in Withholding Taxes. The Issuer
may redeem all, but not less than all, of the Notes at any time, upon not less
than 30 nor more than 60 days' notice, at 100% of the aggregate principal amount
of the Notes, together with accrued and unpaid interest and Special Interest, if
any, to the Redemption Date, if the Issuer has become or would become obligated
to pay, on the next date on which any amount would be payable with respect to
the Notes, any Additional Amounts as a result of a change in the laws (including
any regulations promulgated thereunder) of a Relevant Taxing Jurisdiction, or
any change in any official position of any governmental agency, taxing authority
or regulatory authority regarding the application or interpretation of such laws
or regulations, which change is announced on or after the date of this offering
circular (a "CHANGE IN LAW"), and the Issuer cannot avoid such obligation by
taking reasonable measures available to it.
Before the Issuer publishes or mails notice of redemption of the
Notes as described above, the Issuer shall deliver to the Trustee an Officers'
Certificate to the effect that it cannot avoid its obligation to pay Additional
Amounts by taking reasonable measures available to it and an opinion of
independent legal counsel of recognized standing stating that the Issuer would
be obligated to pay Additional Amounts as a result of a Change in Law. No such
notice of redemption may be given more than 60 days before or more than 90 days
after the Issuer first becomes aware of its liability to pay any Additional
Amounts as a result of a Change in Law.
SECTION 11. Denominations, Transfer, Exchange. The Notes are in
registered form without coupons in denominations of US$1,000 and integral
multiples of US$1,000. The transfer of Notes may be registered and Notes may be
exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Issuer may require a Holder to pay any taxes and fees
required by law or permitted by the Indenture. The Issuer and the Registrar are
not required to transfer or exchange any Note selected for redemption. Also, the
Issuer and the Registrar are
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not required to transfer or exchange any Notes for a period of 15 days before a
selection of Notes to be redeemed.
SECTION 12. Persons Deemed Owners. The registered Holder of a Note
may be treated as its owner for all purposes.
SECTION 13. Amendment, Supplement and Waiver. Subject to certain
exceptions, the Indenture and the Notes may be amended or supplemented with the
written consent of the Holders of at least a majority in aggregate principal
amount of the Notes then outstanding, and any existing Default or compliance
with any provision may be waived with the consent of the Holders of a majority
in aggregate principal amount of the Notes then outstanding. Without notice to
or consent of any Holder, the parties thereto may amend or supplement the
Indenture and the Notes to, among other things, cure any ambiguity, defect or
inconsistency in the Indenture, provide for uncertificated Notes in addition to
certificated Notes, comply with any requirements of the Commission in connection
with the qualification of the Indenture under the Trust Indenture Act, or make
any change that does not materially adversely affect the rights of any Holder of
a Note.
SECTION 14. Defaults and Remedies. If an Event of Default occurs and
is continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Notes generally may declare all the Notes to be due and
payable immediately. Notwithstanding the foregoing, in the case of an Event of
Default arising from certain events of bankruptcy or insolvency as set forth in
the Indenture, with respect to the Issuer, all outstanding Notes shall become
due and payable without further action or notice. Holders may not enforce the
Indenture or the Notes except as provided in the Indenture. Subject to certain
limitations, Holders of a majority in principal amount of the then outstanding
Notes may direct the Trustee in its exercise of any trust or power. The Trustee
may withhold from Holders notice of any continuing Default (except a Default
relating to the payment of principal or interest including an accelerated
payment or the failure to make a payment on the Change of Control Payment Date
or the Asset Sale Payment Date pursuant to a Asset Sale Offer or a Default in
complying with the provisions of Article Five of the Indenture) if it determines
that withholding notice is in their interest. The Holders of a majority in
aggregate principal amount of the Notes then outstanding by notice to the
Trustee may on behalf of the Holders of all of the Notes waive any existing
Default and its consequences under the Indenture except a continuing Default in
the payment of interest on, or the principal of, or the premium on, the Notes.
SECTION 15. Restrictive Covenants. The Indenture contains certain
covenants that, among other things, limit the ability of the Issuer and its
Restricted Subsidiaries to make restricted payments, to incur indebtedness, to
create liens, to sell assets, to permit restrictions on dividends and other
payments by Restricted Subsidiaries of the Issuer, to consolidate, merge or sell
all or substantially all of its assets or to engage in transactions with
affiliates. The limitations are subject to a number of important qualifications
and exceptions. The Issuer must annually report to the Trustee on compliance
with such limitations and other provisions in the Indenture.
SECTION 16. No Recourse Against Others. No director, officer,
employee, incorporator, member or (except as prohibited by applicable law)
shareholder of the Issuer or any Guarantor, as such, shall have any liability
for any obligations of the Issuer under the Notes or
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this Indenture or of any Guarantor under its Note Guarantee or this Indenture or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. Such waiver and release are part of the consideration for issuance of
the Notes.
SECTION 17. Note Guarantees. This Note shall be entitled to the
benefits of certain Note Guarantees made for the benefit of the Holders.
Reference is hereby made to the Indenture for a statement of the respective
rights, limitations of rights, duties and obligations thereunder of the
Guarantors, the Trustee and the Holders.
SECTION 18. Trustee Dealings with the Issuer. Subject to certain
terms, the Trustee under the Indenture, in its individual or any other capacity,
may become the owner or pledgee of Notes and may otherwise deal with the Issuer,
their Subsidiaries or their respective Affiliates as if it were not the Trustee.
SECTION 19. Authentication. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
SECTION 20. Abbreviations. Customary abbreviations may be used in
the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entirety), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
SECTION 21. Additional Rights of Holders of Restricted Global Notes
and Restricted Definitive Notes. Pursuant to, but subject to the exceptions in,
the Registration Rights Agreement, the Issuer and the Guarantors shall be
obligated to use their commercially reasonable efforts to consummate an exchange
offer pursuant to which the Holder of this Note shall have the right to exchange
this Note for a 9.75% Senior Subordinated Note due 2012 of the Issuer which
shall have been registered under the Securities Act, in like principal amount
and having terms identical in all material respects to this Note (except that
such Note shall not be entitled to Special Interest and shall not contain terms
with respect to transfer restrictions); provided that, an Exchange Security
issued to a person resident in a province or territory of Canada shall be
subject to the provisions of Exhibit B to the Indenture applicable to such
person. The Holders shall be entitled to receive certain Special Interest in the
event such exchange offer is not consummated or the Notes are not offered for
resale and upon certain other conditions, all pursuant to and in accordance with
the terms of the Registration Rights Agreement.(a)
SECTION 22. CUSIP and ISIN Numbers. Pursuant to a recommendation
promulgated by the Committee on Uniform Security Identification Procedures, the
Issuer has caused CUSIP and ISIN numbers to be printed on the Notes and the
Trustee may use CUSIP or ISIN numbers in notices of redemption as a convenience
to Holders. No representation is made
---------------
(a) This Section not to appear on Exchange Securities or Additional
Notes unless required by the terms of such Additional Notes.
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as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
SECTION 23. Governing Law. THIS NOTE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
The Issuer shall furnish to any Holder upon written request and
without charge a copy of the Indenture.
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ASSIGNMENT FORM
I or we assign and transfer this Note to
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee or transferee)
________________________________________________________________________________
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint _______________________________________ agent to
transfer this Note on the books of the Issuer. The agent may substitute another
to act for him.
Dated: _________________ Signed: ________________________________________
(Sign exactly as name appears on the
other side of this Note)
Signature Guarantee: ___________________________________________________________
Participant in a recognized Signature
Guarantee Medallion Program (or other
signature guarantor program reasonably
acceptable to the Trustee)
In connection with any transfer of this Note occurring prior to the
date which is the date following the second anniversary of the original issuance
of this Note, the undersigned confirms that it has not utilized any general
solicitation or general advertising in connection with the transfer and is
making the transfer pursuant to one of the following:
[Check One]
(1)___ to the Issuer or a subsidiary thereof; or
(2)___ to a person who the transferor reasonably believes is a "qualified
institutional buyer" pursuant to and in compliance with Rule 144A under
the Securities Act of 1933, as amended (the "Securities Act"); or
(3)___ to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) that has furnished
to the Trustee a signed letter containing certain representations and
agreements (the form of which letter can be obtained from the Trustee);
or
(4)___ outside the United States to a non-"U.S. person" as defined in Rule 902
of Regulation S under the Securities Act in compliance with Rule 904 of
Regulation S under the Securities Act; or
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(5)___ pursuant to the exemption from registration provided by Rule 144 under
the Securities Act or pursuant to another exemption available under the
Securities Act; or
(6)___ pursuant to an effective registration statement under the Securities
Act.
and unless the box below is checked, the undersigned confirms that such Note is
not being transferred to an "affiliate" of the Issuer as defined in Rule 144
under the Securities Act (an "Affiliate"):
[ ] The transferee is an Affiliate of the Issuer.
Unless one of the foregoing items (1) through (6) is checked, the
Trustee will refuse to register any of the Notes evidenced by this certificate
in the name of any person other than the registered Holder thereof; provided,
however, that if item (3), (4) or (5) is checked, the Issuer or the Trustee may
require, prior to registering any such transfer of the Notes, in their sole
discretion, such written legal opinions, certifications (including an investment
letter in the case of box (3) or (4)) and other information as the Trustee or
the Issuer has reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act.
If none of the foregoing items (1) through (6) are checked, the
Trustee or Registrar shall not be obligated to register this Note in the name of
any person other than the Holder hereof unless and until the conditions to any
such transfer of registration set forth herein and in Section 2.16 of the
Indenture shall have been satisfied.
Dated: _________________ Signed:_________________________________________
(Sign exactly as name appears on the
other side of this Note)
Signature Guarantee: ___________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Note for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Issuer as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: _________________ Signed: ________________________________________
NOTICE: To be executed by an
executive officer
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuer
pursuant to Section 4.09 or Section 4.13 of the Indenture, check the appropriate
box:
Section 4.09 [ ] Section 4.13 [ ]
If you want to elect to have only part of this Note purchased by the
Issuer pursuant to Section 4.09 or Section 4.13 of the Indenture, state the
amount (in denominations of US$1,000 and integral multiples thereof):
US$___________
Dated: _________________ Signed: _______________________________
(Sign exactly as name appears on
the other side of this Note)
Signature Guarantee: _______________________________________
Participant in a recognized Signature
Guarantee Medallion Program (or other
signature guarantor program reasonably
acceptable to the Trustee)
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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE(a)
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Physical Note, or exchanges of a part
of another Global Note or Physical Note for an interest in this Global Note,
have been made:
Principal Amount of
Amount of decrease this Global Note Signature of
in Principal Amount Amount of increase in following such authorized officer
of Principal Amount of decrease of Trustee or Note
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- ------------------- --------------------- ------------------- ------------------
-------------
(a) This schedule should be included only if the Note is issued in global form.
A-13
EXHIBIT B
FORM OF LEGENDS
Each Global Note and Physical Note that constitutes a Restricted
Security shall bear the following legend (the "Private Placement Legend") on the
face thereof until after the second anniversary of the Issue Date, unless
otherwise agreed by the Issuer and the Holder thereof or if such legend is no
longer required by Section 2.16(g) of the Indenture:
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A PERSON
WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN
INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (5) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (B) IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES AND OTHER JURISDICTIONS.
Each Global Note authenticated and delivered hereunder shall also
bear the following legend:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF
A DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS NOTE IS NOT EXCHANGEABLE FOR
NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS
NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE,
AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A
WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF
THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY
BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
B-1
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.16 OF THE INDENTURE.
Each Temporary Regulation S Global Note shall also bear the
following legend:
"THIS GLOBAL NOTE IS A TEMPORARY GLOBAL NOTE FOR PURPOSES OF REGULATION S
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"). NEITHER THIS TEMPORARY GLOBAL NOTE NOR ANY INTEREST
HEREIN MAY BE OFFERED, SOLD OR DELIVERED, EXCEPT AS PERMITTED UNDER THE
INDENTURE REFERRED TO BELOW.
"NO BENEFICIAL OWNERS OF THIS TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO
RECEIVE PAYMENT OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED
CERTIFICATIONS HAVE BEEN DELIVERED PURSUANT TO THE TERMS OF THE
INDENTURE."
Each Note sold to a person resident in a province or territory of
Canada and each Note issued as an Exchange Security to a person resident in a
province or territory of Canada shall also bear the following legend, or the
related confirmation or other ownership statement in the event that a book-entry
system is used shall bear the following legend or restriction, in either case
until such legend or restriction shall no longer be necessary or advisable
because such Note is no longer subject to the restrictions on transfer contained
therein:
"UNLESS PERMITTED UNDER CANADIAN SECURITIES LEGISLATION, THE HOLDER OF
THIS SECURITY MUST NOT TRADE THE SECURITY IN OR TO A PERSON IN ANY
PROVINCE OR TERRITORY OF CANADA BEFORE THE DATE THAT IS 4 MONTHS AND A DAY
AFTER THE LATER OF (i) [INSERT THE DISTRIBUTION DATE], AND (ii) THE DATE
B-2
THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY."
B-3
EXHIBIT C
Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Institutional Accredited Investors
[ ], [ ]
U.S. Bank Trust National Association
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Corporate Trust Services
Ladies and Gentlemen:
In connection with our proposed purchase of 9.75% Senior
Subordinated Notes due 2012 (the "NOTES") of MAAX CORPORATION, a Nova Scotia
unlimited company (the "ISSUER"), we confirm that:
1. We understand that any subsequent transfer of the Notes is
subject to certain restrictions and conditions set forth in the Indenture
relating to the Notes (the "Indenture") and the undersigned agrees to be
bound by, and not to resell, pledge or otherwise transfer the Notes except
in compliance with, such restrictions and conditions and the Securities
Act of 1933, as amended (the "Securities Act"), and all applicable state
securities laws.
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes may not be
offered, sold, pledged or otherwise transferred except as permitted in the
following sentence. We agree, on our own behalf and on behalf of any
accounts for which we are acting as hereinafter stated, that if we should
sell, offer, pledge or otherwise transfer any Notes, we will do so only
(i) to the Issuer or any of its subsidiaries, (ii) inside the United
States in a transaction meeting the requirements of Rule 144A under the
Securities Act to a person who we reasonably believe to be a "qualified
institutional buyer" (as defined in Rule 144A under the Securities Act),
(iii) inside the United States to an institutional "accredited investor"
(as defined below) that is purchasing at least US$250,000 of Notes for its
own account or for the account of an institutional accredited investor and
who, prior to such transfer, furnishes (or has furnished on its behalf by
a U.S. broker-dealer) to the Trustee (as defined in the Indenture) a
signed letter containing certain representations and agreements relating
to the restrictions on transfer of the Notes (the form of which letter can
be obtained from the Trustee), (iv) outside the United States to a person
that is not a U.S. person (as defined in Rule 902 under the Securities
Act) in accordance with Regulation S promulgated under the Securities Act,
(v) pursuant to the exemption from registration provided by Rule 144 under
the Securities Act (if available) or another available exemption under the
Securities Act or (vi) pursuant to an effective registration statement
under the Securities Act, and we further agree to provide to any person
C-1
purchasing any of the Notes from us a notice advising such purchaser that
resales of the Notes are restricted as stated herein.
3. We are not acquiring the Notes for or on behalf of, and will not
transfer the Notes to, any pension or welfare plan (as defined in Section
3 of the Employee Retirement Income Security Act of 1974, as amended) or
plan (as defined in Section 4975 of the Internal Revenue Code of 1986, as
amended), except as permitted in the section entitled "Notice to
Investors" of the Offering Circular.
4. We understand that, on any proposed resale of any Notes, we will
be required to furnish to the Trustee and the Issuer such certification,
legal opinions and other information as the Trustee and the Issuer may
reasonably require to confirm that the proposed sale complies with the
foregoing restrictions. We further understand that the Notes purchased by
us will bear a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to
be capable of evaluating the merits and risks of our investment in the
Notes, and we and any accounts for which we are acting are each able to
bear the economic risk of our or their investment, as the case may be.
6. We are acquiring the Notes purchased by us for our account or for
one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.
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You, as Trustee, the Issuer, counsel for the Issuer and others are
entitled to rely upon this letter and are irrevocably authorized to produce this
letter or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:
------------------------------------
Name:
Title:
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EXHIBIT D
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
[ ], [ ]
U.S. Bank Trust National Association
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Corporate Trust Services
Re: MAAX Corporation (the "Issuer")
9.75% Senior Subordinated Notes due 2012 (the "Notes")
Ladies and Gentlemen:
In connection with our proposed sale of US$[ ] aggregate principal
amount of the Notes, we confirm that such sale has been effected pursuant to and
in accordance with Regulation S under the U.S. Securities Act of 1933, as
amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the United
States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the United
States, or (b) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United States
in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer restrictions
applicable to the Notes.
You, as Trustee, the Issuer, counsel for the Issuer and others are
entitled to rely upon this letter and are irrevocably authorized to produce this
letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby.
Terms used in this certificate have the meanings set forth in Regulation S.
D-1
Very truly yours,
[Name of Transferor]
By:
------------------------------------
Authorized Signatory
D-2
EXHIBIT E
FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH
TRANSFERS OF TEMPORARY REGULATION S GLOBAL NOTE
________________,______
U.S. Bank Trust National Association
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Corporate Trust Services
Re: MAAX Corporation (the "Issuer")
9.75% Senior Subordinated Notes due 2012 (the "Notes")
Dear Sirs:
This letter relates to U.S. $ ______________ principal amount of
Notes represented by a certificate (the "LEGENDED CERTIFICATE") which bears a
legend outlining restrictions upon transfer of such Legended Certificate.
Pursuant to Section 2.16(c) of the Indenture (the "INDENTURE") dated as of June
4, 2004 relating to the Notes, we hereby certify that we are (or we will hold
such securities on behalf of) a person outside the United States (or to an
Initial Purchaser (as defined in the Indenture)) to whom the Notes could be
transferred in accordance with Rule 904 of Regulation S promulgated under the
U.S. Securities Act of 1933, as amended.
You, as Trustee, the Issuer, counsel for the Issuer and others are
entitled to rely upon this letter and are irrevocably authorized to produce this
letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby.
Terms used in this letter have the meanings set forth in Regulation S.
Very truly yours,
[Name of Holder]
By:
-----------------------------------
Authorized Signature
E-1
EXHIBIT F
NOTE GUARANTEE
For value received, each of the undersigned hereby unconditionally
guarantees, jointly and severally, to the extent set forth in the Indenture (as
defined below) to the Holder of this Note the payment of principal, premium, if
any, and interest on this Note in the amounts and at the times when due and
interest on the overdue principal, premium, if any, and interest, if any, of
this Note when due, if lawful, and, to the extent permitted by law, the payment
or performance of all other obligations of the Issuer under the Indenture or the
Notes, to the Holder of this Note and the Trustee, all in accordance with and
subject to the terms and limitations of this Note, the Indenture, including
Article Eleven thereof, and this Note Guarantee. This Note Guarantee will become
effective in accordance with Article Eleven of the Indenture and its terms shall
be evidenced therein. The validity and enforceability of any Note Guarantee
shall not be affected by the fact that it is not affixed to any particular Note.
Capitalized terms used but not defined herein shall have the
meanings ascribed to them in the Indenture dated as of June 4, 2004, among MAAX
Corporation, a Nova Scotia unlimited company (the "Issuer"), the Guarantors
named therein and U.S. Bank
Trust, N.A., as Trustee (the "Trustee"), as amended or supplemented
(the "Indenture").
The obligations of the undersigned to the Holders and to the Trustee
pursuant to this Note Guarantee and the Indenture are expressly set forth in
Article Eleven of the Indenture and reference is hereby made to the Indenture
for the precise terms of the Note Guarantee and all of the other provisions of
the Indenture to which this Note Guarantee relates.
No director, officer, employee, incorporator, stockholder, member,
partner or manager of any Guarantor, as such, shall have any liability for any
obligations of such Guarantors under such Guarantors' Note Guarantee or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligation or its creation.
This Note Guarantee is subordinated in right of payment, in the
manner and to the extent set forth in Article Eleven of the Indenture, to the
prior payment in full in cash or cash equivalents of all Senior Debt of the
Guarantors, whether outstanding on the date of the Indenture or thereafter
created, incurred, assumed or guaranteed.
THIS NOTE GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
This Note Guarantee is subject to release upon the terms set forth
in the Indenture.
F-1
IN WITNESS WHEREOF, each Guarantor has caused its Note Guarantee to
be duly executed.
Date:
BEAUCELAND CORPORATION
By:
-----------------------------------
Name:
Title:
4200217 CANADA INC.
By:
-----------------------------------
Name:
Title:
MAAX HOLDING CO.
MAAX-KSD CORPORATION
PEARL BATHS, INC.
MAAX-HYDRO SWIRL
MANUFACTURING CORP.
MAAX MIDWEST, INC.
MAAX SPAS (ARIZONA), INC.
XXXX PLASTICS COMPANY INC.
MAAX CANADA INC.
CUISINE EXPERT - C.E. CABINETS INC.
0000-0000 XXXXXX INC.
MAAX SPAS (ONTARIO) INC.
MAAX SPAS (B.C.) INC.
By:
-----------------------------------
Name:
Title:
MAAX LLC
By:
-----------------------------------
Name:
Title:
F-2
